Convergence Clubs and Diverging Economies
AbstractThis paper focuses on the question of income convergence among countries. While the methodology used to determine convergence differs from the common cross-sectional approach, it corroborates Baumol's finding of a convergence club among the world's wealthiest countries. It also shows that there is strong evidence in support of a second convergence club, however. This one is among the world's very poorest countries. These clubs exhibit different forms of convergence. The group of wealthy countries is characterized by what may be referred to as upward convergence, where the poorer group members catch up with the richer countries. The group of extremely poor countries exhibits downward convergence, or a reduction in income disparity brought about by nearly zero, or even negative, growth by the group's `wealthier' members. One of the attributes that sets these countries at the bottom apart is that they are very close to what Stigler once calculated as the least cost subsistence diet. Inserting this constraint into the neoclassical growth model produces two steady states, with divergence in between. An example of such a model is developed here.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoPaper provided by Tel Aviv in its series Papers with number 40-95.
Length: 12 pages
Date of creation: 1995
Date of revision:
Contact details of provider:
Postal: Israel TEL-AVIV UNIVERSITY, THE FOERDER INSTITUTE FOR ECONOMIC RESEARCH, RAMAT AVIV 69 978 TEL AVIV ISRAEL.
Web page: http://econ.tau.ac.il/research/foerder.asp
More information through EDIRC
Other versions of this item:
- D30 - Microeconomics - - Distribution - - - General
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading lists or Wikipedia pages:
- Convergence clubs in Wikipedia (English)
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thomas Krichel).
If references are entirely missing, you can add them using this form.