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Investigating the Catching-Up Hypothesis Using Panel Unit Root Tests: Evidence from the PIIGS

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  • Xanthippi Chapsa
  • Nikolaos Tabakis
  • Athanasios L. Athanasenas

Abstract

The aim of this paper is to analyze the issue of income convergence for Portugal, Italy, Ireland, Greece, and Spain (PIIGS), towards France.The empirical analysis uses per capita GDP, in PPP and 2005 constant prices and covers the period from 1950 up to the recent pre-crisis year of 2009. The methodology applied uses non-stationary panel unit root tests both without as well as with structural breaks endogenously determined.The results clearly demonstrate the gain in power from combining structural breaks with panel data. Our findings provide evidence in favor of convergence for all the five countries with France.

Suggested Citation

  • Xanthippi Chapsa & Nikolaos Tabakis & Athanasios L. Athanasenas, 2018. "Investigating the Catching-Up Hypothesis Using Panel Unit Root Tests: Evidence from the PIIGS," European Research Studies Journal, European Research Studies Journal, vol. 0(1), pages 250-271.
  • Handle: RePEc:ers:journl:v:xx:y:2017:i:3b:p:250-271
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    Cited by:

    1. Nakije Kida, 2020. "Dynamic Relationship Between Government Spending, Final Consumption and Savings: Evidence from Southeast Europe," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(3), pages 374-392.
    2. Imamudin Yuliadi, 2020. "The Implementation of a Dual Monetary System in Indonesia," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(3), pages 28-39.

    More about this item

    Keywords

    Stochastic Convergence; Panel Uunit Root Tests; Panel LM Unit Root Tests; PIIGS. JEL Classification: C23; O47; 052.;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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