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Capital Deepening and Manufacturing's Contribution to Regional Economic Convergence

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  • Weber, William L.
  • Domazlicky, Bruce R.

Abstract

Using data on the manufacturing sector for the 50 states during 1977-1996, we decompose labor productivity growth into changes due to enhanced efficiency, capital accumulation, and technological progress. We find some evidence that labor productivity is converging among the 50 states, although the variance of labor productivity increased during 1977-1996. Using a series of kernel distribution tests we find that capital accumulation and technological progress contributed to labor productivity growth during the period, but changes in state efficiency had no effect on productivity growth.

Suggested Citation

  • Weber, William L. & Domazlicky, Bruce R., 2006. "Capital Deepening and Manufacturing's Contribution to Regional Economic Convergence," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 36(1).
  • Handle: RePEc:ags:jrapmc:132312
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    File URL: http://purl.umn.edu/132312
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    References listed on IDEAS

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    1. Mitchener, Kris James & McLean, Ian W., 1999. "U.S.Regional Growth And Convergence, 1880–1980," The Journal of Economic History, Cambridge University Press, vol. 59(04), pages 1016-1042, December.
    2. Robert J. Barro & Xavier Sala-i-Martin, 1991. "Convergence across States and Regions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(1), pages 107-182.
    3. Robert J. Barro, 2013. "Inflation and Economic Growth," Annals of Economics and Finance, Society for AEF, vol. 14(1), pages 121-144, May.
    4. Weber, William L. & Domazlicky, Bruce R., 1999. "Total factor productivity growth in manufacturing: a regional approach using linear programming," Regional Science and Urban Economics, Elsevier, vol. 29(1), pages 105-122, January.
    5. Bernard, Andrew B & Jones, Charles I, 1996. "Comparing Apples to Oranges: Productivity Convergence and Measurement across Industries and Countries," American Economic Review, American Economic Association, vol. 86(5), pages 1216-1238, December.
    6. Efthymios Tsionas, 2001. "Regional Convergence and Common, Stochastic Long-run Trends: A Re-examination of the US Regional Data," Regional Studies, Taylor & Francis Journals, vol. 35(8), pages 689-696.
    7. Efthymios Tsionas, 2000. "Regional Growth and Convergence: Evidence from the United States," Regional Studies, Taylor & Francis Journals, vol. 34(3), pages 231-238.
    8. Koop, Gary, 2001. "Cross-Sectoral Patterns of Efficiency and Technical Change in Manufacturing," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 42(1), pages 73-103, February.
    9. Aberg, Yngve, 1973. "I. regional productivity differences in Swedish manufacturing," Regional and Urban Economics, Elsevier, vol. 3(2), pages 131-155, May.
    10. Subodh Kumar & R. Robert Russell, 2002. "Technological Change, Technological Catch-up, and Capital Deepening: Relative Contributions to Growth and Convergence," American Economic Review, American Economic Association, vol. 92(3), pages 527-548, June.
    11. Barro, Robert J & Sala-i-Martin, Xavier, 1992. "Convergence," Journal of Political Economy, University of Chicago Press, vol. 100(2), pages 223-251, April.
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    Cited by:

    1. Mugera, Amin W. & Langemeier, Michael R. & Featherstone, Allen M., 2012. "Labor Productivity Growth in the Kansas Farm Sector: A Tripartite Decomposition Using a Non-Parametric Approach," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 41(3), December.
    2. Daniel Felsenstein, 2011. "Capital Deepening and Regional Inequality: An Empirical Analysis (refereed paper)," ERSA conference papers ersa10p759, European Regional Science Association.

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