An Alternative Approach to the Analysis of the U.S. Per Capita Income Convergence

49 Pages Posted: 2 Aug 2004

See all articles by Ming Chien Lo

Ming Chien Lo

Saint Cloud State University - Department of Economics

Mark Partridge

Ohio State University (OSU) - Department of Agricultural, Environmental & Development Economics

Date Written: July 1, 2005

Abstract

This paper examines U.S. per capita income convergence in 1929-2002 using a panel approach based on the assumptions of multiple aggregate structural breaks and growth clubs. One novelty is that our specification explicitly allows for regional conditional convergence to the nation, while at the same time allowing for regional-growth clubs in which states conditionally converge to their regional average. In general, the results support those who argue the entire cross-section of growth dynamics should be examined. In particular, the estimates of convergence speed from previous studies are strongly affected by a post-1982 divergence and a club-growth pattern, which are ignored under simpler econometric specifications.

Keywords: Convergence, growth clubs, panel time series models, structural changes

JEL Classification: O47, O18, R11, R12

Suggested Citation

Lo, Ming Chien and Partridge, Mark D., An Alternative Approach to the Analysis of the U.S. Per Capita Income Convergence (July 1, 2005). Available at SSRN: https://ssrn.com/abstract=571222 or http://dx.doi.org/10.2139/ssrn.571222

Ming Chien Lo (Contact Author)

Saint Cloud State University - Department of Economics ( email )

720 Fourth Avenue South
St. Cloud, MN 56301-4498
United States
320-308-0143 (Phone)
320-308-2228 (Fax)

Mark D. Partridge

Ohio State University (OSU) - Department of Agricultural, Environmental & Development Economics ( email )

2120 Fyffe Rd
Columbus, OH 43210-1067
United States

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