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Income convergence: fresh evidence from the Nordic countries

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  • Venus Khim-Sen Liew
  • Yusuf Ahmad

Abstract

Using the recently developed linearity test and nonlinear unit root test, this study shows that the income gaps of Finland, Norway and Sweden with respect to Denmark are nonlinear but stationary with no significant trend effect, implying the Nordic countries have already attained steady state of income equality, a state beyond catching up as identified earlier in Oxley and Gresley (1999). This fresh evidence strengthens the finding of Nordic Convergence Club by these authors.

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Applied Economics Letters.

Volume (Year): 16 (2009)
Issue (Month): 12 ()
Pages: 1245-1248

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Handle: RePEc:taf:apeclt:v:16:y:2009:i:12:p:1245-1248

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  1. repec:ebl:ecbull:v:15:y:2005:i:1:p:1-7 is not listed on IDEAS
  2. n/a, 2001. "Balance of payments prospects in EMU," NIESR Discussion Papers 164, National Institute of Economic and Social Research.
  3. Les Oxley & David Greasley, 1999. "A Nordic convergence club?," Applied Economics Letters, Taylor & Francis Journals, vol. 6(3), pages 157-160.
  4. Venus Khim-Sen Liew & Kian-Ping Lim, 2005. "Income Divergence? Evidence of Non-linearity in the East Asian Economies," Economics Bulletin, AccessEcon, vol. 15(1), pages 1-7.
  5. Kapetanios, George & Shin, Yongcheol & Snell, Andy, 2003. "Testing for a unit root in the nonlinear STAR framework," Journal of Econometrics, Elsevier, vol. 112(2), pages 359-379, February.
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