Economic convergence exists when two or more economies tend to reach a similar level of development and wealth. The study of convergence is an important topic because besides being useful for the debate between different theories, it can respond several inquiries such as if the distribution of income between economies has become more equal over time and if poor economies are catching up with the rich. Latin American countries are characterized by having few language barriers, similar culture, religion and common history. So convergence could be expected. However, literature about convergence in Latin America is scarce and preliminary analysis shows that divergence exists in the region. The thesis tries to fill in the gap by covering theoretical, historical and statistical evidence of convergence in the region during 106 years, from 1900 to 2005. The thesis uses a neoclassical growth model based on Solow and Ramsey models. After revising the economic history of 32 countries, several groups were identified and convergence was expected to occur. Different concepts of convergence are tested inside each group through graphs, single cross section regressions and panel data estimations. In general, the results show a success with the grouping. However, the groups that converged under all concepts are those composed by countries that have succeeded in industrializing and/or were able to build strong institutions that could promote welfare and economic growth in a globalization context. The speed of convergence for those countries is around 2%. It is also found that integration processes have not helped to accelerate convergence.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
References listed on IDEAS 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.:
Durlauf, Steven N. & Quah, Danny T., 1999.
"The new empirics of economic growth,"
Handbook of Macroeconomics,
in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 4, pages 235-308
Elsevier.
[Downloadable!] (restricted)
Other versions: