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Tests of the "Convergence Hypothesis": Some Further Results

  • Cohen, Daniel

The article presents new tests of the convergence hypothesis. It first analyzes the unconditional pattern of growth of human and physical capital (conventionally measured by an inventory method) and shows that these tests do support the hypothesis that domestic inputs of poor countries appear to be catching up with those of rich countries. On the other hand, when one analyzes the pattern of growth of physical capital and Solow residual, then one is led to reject the convergence theory. Building on this discrepancy, I demonstrate that the poor countries have failed to catch up with rich ones because the progress that they have achieved in educating their workers (which is evidenced in the convergence of domestic inputs) is not sufficient to compensate for their poor endowment in the knowledge on which the education of workers stands. Copyright 1996 by Kluwer Academic Publishers

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Article provided by Springer in its journal Journal of Economic Growth.

Volume (Year): 1 (1996)
Issue (Month): 3 (September)
Pages: 351-61

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Handle: RePEc:kap:jecgro:v:1:y:1996:i:3:p:351-61
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