Income Convergence: Fresh Evidence from the Nordic Countries
11 Pages Posted: 12 May 2009
Date Written: May, 11 2009
Using the recently developed linearity test and non-linear unit root test, this study shows that the income gaps of Finland, Norway and Sweden with respect to Denmark are non-linear but stationary with no significant trend effect, implying the Nordic countries have already attained steady state of income equality, a state beyond catching up as identified earlier in Oxley and Greasley (1999). This fresh evidence strengthens the finding of Nordic Convergence Club by these authors.
Keywords: income convergence, Nordic, non-linear test
JEL Classification: C22,F43
Suggested Citation: Suggested Citation