Spatial Dependence and Economic Growth: Evidence from a Panel of Countries
Borradores de Economia Working Paper No. 206
38 Pages Posted: 3 Jun 2002
Date Written: May 2002
The empirical growth literature has usually ignored spatial interdependence among countries. This paper uses spatial econometrics to estimate a growth model in which a country's economic growth depends on the growth rate of its neighbors. The results show that spatial relationships are relevant for the entire sample of 98 economies, but when the sample is divided by continents the spatial dependence is not longer significant. Nonetheless, the relevance of spatial effects is recovered when levels of income instead of rates of growth are considered.
Keywords: Economic growth, interdependence, spatial econometrics, levels of income
JEL Classification: O40, O57, R11, C21
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