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Convergence in an Open-Economy Growth Model

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Author Info
Bourdot, B.
Frith, M.
Wells, G.

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Abstract

This paper reviews the origins of the 2 per percent rule, arguing that existing evidence for the rule is not as strong as is often supposed and that in any case it can be a misleading guide to the payoff period in policy applications. In the context of a postulated change in the rate of increase of total factor productivity, we show that the convergence speed of the former growth rate is markedly slower than the latter.

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Publisher Info
Paper provided by Centre for Economic Policy Research, Research School of Social Sciences, Australian National University in its series CEPR Discussion Papers with number 392.

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Length: 27 pages
Date of creation: 1998
Date of revision:
Handle: RePEc:auu:dpaper:392

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Web page: http://econrsss.anu.edu.au/
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Related research
Keywords: PRODUCTIVITY ; GROWTH MODELS ; ECONOMIC DEVELOPMENT;

Find related papers by JEL classification:
D24 - Microeconomics - - Production and Organizations - - - Production; Capital and Total Factor Productivity; Capacity
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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This page was last updated on 2009-10-18.

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