Divided: The Two Americas-Examining Club Convergence in the U.S

María Candelaria Barrios González, Heather L.R. Tierney, Zafar Nazarov and Myeong Hwan Kim

MPRA Paper from University Library of Munich, Germany

Abstract: This paper finds club convergence within the 50 U.S. states using Phillips and Sul’s (2007, 2009) regression-based convergence test using per capita real state domestic product from 1997 to 2017. Two clubs with diverging transition paths are found. Clubs 1 and 2 mimics the divide that is seen in the flow of funds from the federal government to the states (DiNapoli 2017, 2018). Hence, the log t test of Phillips and Sul (2007) is telling the tale of there being two Americas if all factors remain the same, but this need not be the case with the proper policy prescription.

Keywords: Convergence Clubs; Economic Convergence; Log t-Test; Growth and Development; U.S. (search for similar items in EconPapers)
JEL-codes: C33 O11 O33 O47 (search for similar items in EconPapers)
Date: 2019-11
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