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Is There Enough Evidence Against Absolute Convergence?

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  • Rómulo A. Chumacero

Abstract

This paper analyzes whether or not the econometric methods usually applied to test for absolute convergence have provided this hypothesis a fair. I show that traditional (absolute and conditional) convergence tests are not consistent with even the simplest model that displays convergence. Furthermore, claims of divergence on the grounds of bimodalities in the distribution of GDP per capita can be made consistent with models in which neither divergence nor twin peaks are present in the long run.

Suggested Citation

  • Rómulo A. Chumacero, 2002. "Is There Enough Evidence Against Absolute Convergence?," Working Papers Central Bank of Chile 176, Central Bank of Chile.
    • Handle: RePEc:chb:bcchwp:176
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    2. Mr. Bennett W Sutton & Mrs. Genevieve M Lindow & Maria Isabel Serra & Mr. Gustavo Ramirez & Maria Fernanda Pazmino, 2006. "Regional Convergence in Latin America," IMF Working Papers 2006/125, International Monetary Fund.
    3. Roberto Duncan & J. Rodrigo Fuentes, 2005. "Convergencia Regional en Chile: Nuevos Tests, Viejos Resultados," Working Papers Central Bank of Chile 313, Central Bank of Chile.
    4. Solange Berstein & Alejandro Micco, 2002. "Turnover and Regulation: The Chilean Pension Fund Industry," Working Papers Central Bank of Chile 180, Central Bank of Chile.
    5. Grafström, Jonas & Jaunky, Vishal, 2017. "Convergence of Incentive Capabilities within the European Union," Ratio Working Papers 301, The Ratio Institute.
    6. Jaunky, Vishal Chandr, 2013. "Divergence in technical efficiency of electric utilities: Evidence from the SAPP," Energy Policy, Elsevier, vol. 62(C), pages 419-430.

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