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Convergence of Sectoral Productivity in Turkish Provinces: A Markov Chains Model

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  • Temel, T.
  • Tansel, A.
  • Gungor, N.D.

Abstract

this study examines the role that sectors play in aggregate convergence of provincial labor productivity across the 67 provinces of turkey during the 1975-1990 period. a markov chain model is applied to characterize the long-run tendencies of productivity both at the aggregate and sectoral levels. in order to determine the likely sources of aggregate fluctuations, sectoral time-invariant distributions are compared with the aggregate distribution, and those sectors that exhibit similar distribution patterns as that of the aggregate distribution are characterized as dominant sectors. evidence strongly suggests that the aggregate time-invariant distribution is determined mainly by the agricultural, industrial and transportation sectors. specifically, the pattern of polarization of productivity levels in these three sectors is very similar to the pattern prevailing at the aggregate level. the results suggest that, in the long run, two convergence clubs are likely to emerge - one for the agricultural and another for the highly industrialized provinces. an exception is the service sector, which exhibits global convergence.

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Bibliographic Info

Article provided by Euro-American Association of Economic Development in its journal International Journal of Applied Econometrics and Quantitative Studies .

Volume (Year): 2 (2005)
Issue (Month): 2 ()
Pages: 65-84

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Handle: RePEc:eaa:ijaeqs:v:2:y2005:i:2_6

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Related research

Keywords: convergence; aggregate and sectoral labor productivity; markov chains;

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References

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  1. Barro, R.J., 1989. "Economic Growth In A Cross Section Of Countries," RCER Working Papers 201, University of Rochester - Center for Economic Research (RCER).
  2. Bernard, Andrew B & Jones, Charles I, 1996. "Comparing Apples to Oranges: Productivity Convergence and Measurement across Industries and Countries," American Economic Review, American Economic Association, vol. 86(5), pages 1216-38, December.
  3. Tugrul Temel, 2000. "U.S. Farm Wages and Labor Market Efficiency," Growth and Change, Gatton College of Business and Economics, University of Kentucky, vol. 31(3), pages 420-437.
  4. Tugrul Temel & Edward M. Tavernier, 2001. "Are U.S. Farm Wages Really Depressing? Evidence from the Northeast and South," The Review of Regional Studies, Southern Regional Science Association, vol. 29(3), pages 212-225, Winter.
  5. Bernard, Andrew B. & Durlauf, Steven N., 1996. "Interpreting tests of the convergence hypothesis," Journal of Econometrics, Elsevier, vol. 71(1-2), pages 161-173.
  6. Quah, Danny, 1993. "Empirical cross-section dynamics in economic growth," European Economic Review, Elsevier, vol. 37(2-3), pages 426-434, April.
  7. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-37, October.
  8. Douglas Robertson, 1995. "Are banks converging to one size?," Working Papers 95-29, Federal Reserve Bank of Philadelphia.
  9. Mankiw, N Gregory & Romer, David & Weil, David N, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 107(2), pages 407-37, May.
  10. Quah, Danny, 1993. "Galton's Fallacy and Tests of the Convergence Hypothesis," CEPR Discussion Papers 820, C.E.P.R. Discussion Papers.
  11. Tugrul Temel & Aysit Tansel & Peter J. Albersen, 1999. "Convergence and Spatial Patterns in Labor Productivity: Nonparametric Estimations for Turkey," Working Papers 9931, Economic Research Forum, revised Oct 1999.
  12. Baumol, William J, 1986. "Productivity Growth, Convergence, and Welfare: What the Long-run Data Show," American Economic Review, American Economic Association, vol. 76(5), pages 1072-85, December.
  13. Jonathan Temple, 1999. "The New Growth Evidence," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 112-156, March.
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Cited by:
  1. Karaman, Fatma & Dogruel, Fatma, 2011. "Regional convergence in Turkey: the role of government in economic environment augmenting activities," MPRA Paper 34271, University Library of Munich, Germany.

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