A pair-wise approach to testing for output and growth convergence

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A pair-wise approach to testing for output an ...
Pesaran, M. Hashem
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December 13, 2020 | History

A pair-wise approach to testing for output and growth convergence

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"This paper proposes a pair-wise approach to testing for output convergence that considers all N(N-1)/2 possible pairs of log per capita output gaps across N economies. A general probabilistic definition of output convergence is also proposed, which suggests that all such output gap pairs must be stationary with a constant mean. The approach is compatible with individual output series having unit roots, does not involve the choice of a reference country in computation of output gaps, and can be applied when N is large relative to T (the time dimension of the panel). The proposed test is applied to output series in the Penn World Tables over 1950-2000, as well as to Maddion's historical series over 1870-2000. Overall, the results do not support output convergence, and suggest that the findings of convergence clubs in the literature might be spurious. However, significant evidence of growth convergence is found, a result which is reasonably robust to the choice of the sample period and country groupings. Non-convergence of log per capita outputs combined with growth convergence suggests that while common technological progress seems to have been diffusing reasonably widely across economies, there are nevertheless important countryspecific factors (for example, wars, famines, revolutions, regime and institutional changes) that render output gaps highly persistent, such that we can not be sure that the probability for the outputs gaps to lie within a fixed range will be non-zero"--Forschungsinstitut zur Zukunft der Arbeit web site.

Publish Date
Publisher
IZA
Language
English

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Edition Notes

Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 5/3/2005.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.

Published in
Bonn, Germany
Series
Discussion paper ;, no. 1313, Discussion paper (Forschungsinstitut zur Zukunft der Arbeit : Online) ;, no. 1313

Classifications

Library of Congress
HD5701

The Physical Object

Format
Electronic resource

ID Numbers

Open Library
OL3477510M
LCCN
2005617218

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December 13, 2020 Edited by MARC Bot import existing book
July 29, 2012 Edited by VacuumBot Updated format '[electronic resource] /' to 'Electronic resource'
December 12, 2009 Edited by WorkBot link works
October 31, 2008 Edited by ImportBot add URIs from original MARC record
April 1, 2008 Created by an anonymous user Imported from Scriblio MARC record