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Regional income club convergence in US BEA economic areas: a spatial switching regression approach

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  • Up Lim

Abstract

This study empirically applies the spatial switching regression method to an analysis of regional income club convergence across the 177 economic areas in the contiguous US states over the period from 1969 to 2008. As functionally defined, these economic areas represent the relevant regional markets for labor, products and information. The result of spatial switching regression reveals that the initial gaps between economic areas relative to average global initial per capita income appear to have declined, but the two spatial clubs exhibit a significant difference in their income convergence processes over the period. The estimated coefficient of the convergence parameter for the peripheral spatial regime is negative and highly significant, indicating that a convergence process exists in this spatial regime. However, there is no statistically significant evidence of convergence in the core spatial regime, implying the possibility of different patterns in the growth dynamics of the core spatial regime. Copyright Springer-Verlag Berlin Heidelberg 2016

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  • Up Lim, 2016. "Regional income club convergence in US BEA economic areas: a spatial switching regression approach," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 56(1), pages 273-294, January.
    • Handle: RePEc:spr:anresc:v:56:y:2016:i:1:p:273-294
    DOI: 10.1007/s00168-015-0739-0
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    Keywords

    O18; O47; R11; R12; R58;
    All these keywords.

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy

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