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• W2163645664 abstract "Few subjects in applied economic research have been studied as extensively as the convergence hypothesis advanced by Solow (1956) and documented by Baumol (1986).1 In simple terms, the hypothesis states that poor countries or regions tend to grow faster than rich ones. In its strongest version (known as absolute convergence), the hypothesis implies that in the long run, countries or regions should not only grow at the same rate, but also reach the same per capita income.2 This hypothesis has been tested using different methodologies and datasets, and it appears to be strongly rejected by the data. In view of these results, several modifications of the absolute convergence hypothesis have been advanced and tested, although they usually lack both theoretical foundations and econometric rigor and discipline. This paper analyzes whether the econometric methods usually applied to test for absolute convergence have given this hypothesis a fair chance. The paper is organized as follows. Section 1 presents a brief review of some of the tests for convergence advanced in the empirical literature and documents their shortcomings. Section 2 develops a simple theoretical model that implies absolute convergence. Section 3 discusses the likelihood that time series generated from the model can accommodate the results of the tests described on section 1. Finally, section 4 draws some conclusions." @default.
• W2163645664 created "2016-06-24" @default.
• W2163645664 creator A5026799431 @default.
• W2163645664 date "2002-01-01" @default.
• W2163645664 modified "2023-09-27" @default.
• W2163645664 title "Reviewing the Evidence against Absolute Convergence" @default.
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