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New evidence on long-run output convergence among Latin American countries

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Author Info
Mark J. Holmes () (Waikato University Management School)

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Abstract

This study assesses long-run real per capita output convergence among selected Latin American countries. The empirical investigation, however, is based on an alternative approach. Strong convergence is determined on the basis of the first largest principal component, based on income differences with respect to a chosen base country, being stationary. The qualitative outcome of the test is invariant to the choice of base country and, compared to alternative multivariate tests for long-run convergence, this methodology places less demands on limited data sets. Using annual data for the period 1960-2000, strong convergence is confirmed for the Central American Common Market. However, an amended version of the test confirms weaker long-run convergence in the case of the Latin American Integration Association countries.

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Publisher Info
Article provided by Universidad del CEMA in its journal Journal of Applied Economics.

Volume (Year): VIII (2005)
Issue (Month): (November)
Pages: 299-319
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Handle: RePEc:cem:jaecon:v:8:y:2005:n:2:p:299-319

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Related research
Keywords: output convergence; Latin America; common trends;

Find related papers by JEL classification:
F15 - International Economics - - Trade - - - Economic Integration
O19 - Economic Development, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
O54 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

References listed on IDEAS
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Paola Barrientos, 2007. "Theory, History and Evidence of Economic Convergence in Latin America," Development Research Working Paper Series 13/2007, Institute for Advanced Development Studies. [Downloadable!]
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