Why Nations Converge? Has Globalization Contributed to Convergence? A Panel Data Exploration
58 Pages Posted: 18 Nov 2014
Date Written: November 16, 2014
Using an extensive data base we estimate cross-section and panel growth regression using the MRW model and estimates of Total Factor Productivity with Solow and Hall and Jones methods. The data show an overall process of convergence, but it was uneven over the 1960-2010 years. Was the process intensified with globalization? Data show that after the 1990s international trade played a major role for the restart of convergence. Institutions seem to play a more significant role after the 1990s, as most countries have moved to market economies. The paper confirms also the increasing relevance of outward-oriented policies and the complementarity of cross-section and panel data analysis.
Keywords: Economic development, empirics of growth, econometrics of growth, globalization, convergence
JEL Classification: C31, C33, O1, O3, O4
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