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Economic convergence across German regions in light of empirical findings

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  • John B. Hall
  • Udo Ludwig

Abstract

This paper challenges the convergence hypothesis advanced by R. Barro and X. Sala-i-Martin as it is applied to explain the forces behind, patterns exhibited by and time line for German regional convergence. Exposed in some detail are the spurious neoclassical and marginalist assumptions, purporting that 'automatic' forces would indeed bring about a convergence in per capita incomes between two German regions. A trend exhibiting slow growth in per capita income in Germany's eastern region renders a Beta coefficient so low as to rule out convergence altogether. In addition, capital fails to move between German regions in the pattern assumed by the convergence hypothesis. Copyright 2006, Oxford University Press.

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Bibliographic Info

Article provided by Oxford University Press in its journal Cambridge Journal of Economics.

Volume (Year): 30 (2006)
Issue (Month): 6 (November)
Pages: 941-953

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Handle: RePEc:oup:cambje:v:30:y:2006:i:6:p:941-953

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Cited by:
  1. van Hoorn, André & Maseland, Robbert, 2010. "Cultural differences between East and West Germany after 1991: Communist values versus economic performance?," Journal of Economic Behavior & Organization, Elsevier, vol. 76(3), pages 791-804, December.
  2. Gyawali, Buddhi Raj & Banerjee, Swagata (Ban) & Hill, Anquinette & Bukenya, James O., 2012. "Exploring Variations in Income Growth in Southeastern United States," 2012 Annual Meeting, February 4-7, 2012, Birmingham, Alabama 120933, Southern Agricultural Economics Association.
  3. Yvonne Schindele, 2010. "How Long Does it Take to Become an Entrepreneurial Society - The Case of German Convergence in Self-Employment," Jena Economic Research Papers 2010-015, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
  4. Mohammad Ashraf & Khan A. Mohabbat, 2010. "Output Convergence and the Role of Research and Development," Annals of Economics and Finance, Society for AEF, vol. 11(1), pages 35-71, May.
  5. Juan Carlos Martinez Oliva, 2009. "Riunificazione intertedesca e politiche per la convergenza," Mo.Fi.R. Working Papers 14, Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences.

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