Growth and Convergence Across the U.S.: Evidence from County-Level Data
54 Pages Posted: 3 Oct 2005
We use U.S. county data (3,058 observations) and 41 conditioning variables to study growth and convergence. Using OLS and 3SLS-IV we report on the full sample and metro, non-metro, and 5 regional samples: (1) OLS yields convergence rates around 2 percent; 3SLS yields 6-8 percent; (2) convergence rates vary (e.g., the Southern rate is 2.5 times the Northeastern rate); (3) federal, state and local government negatively correlates with growth; (4) the relationship between educational attainment and growth is nonlinear; and (5) finance, insurance & real estate industry and entertainment industry positively correlates with growth while education employment negatively correlates.
Keywords: Economic Growth, Conditional Convergence, County-Level Data
JEL Classification: O40, O11, O18, O51, R11, H50, H70
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