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The Conditional Convergence Properties of Simple Kaldorian Growth Models


  • Mark Roberts


Findings of conditional convergence are usually interpreted within a neoclassical growth framework. This follows from the methodology of testing for conditional convergence, whereby the estimating equation is explicitly derived from a neoclassical growth model. Given this explicit derivation, findings of conditional convergence might be thought to discriminate against alternative approaches to growth in general and the Kaldorian approach to growth in particular. This article shows, however, that this is not the case. It does so by examining the conditional convergence properties of the 'core' model of Kaldorian growth theory—the Kaldor-Dixon-Thirlwall (KDT) model. In particular, the paper demonstrates that this model predicts conditional convergence of a qualitatively identical nature to that predicted by the neoclassical growth model. A simple extension of the KDT model that is reconciled with quantitative estimates of the speed of conditional convergence is also presented.

Suggested Citation

  • Mark Roberts, 2007. "The Conditional Convergence Properties of Simple Kaldorian Growth Models," International Review of Applied Economics, Taylor & Francis Journals, vol. 21(5), pages 619-632.
  • Handle: RePEc:taf:irapec:v:21:y:2007:i:5:p:619-632
    DOI: 10.1080/02692170701474678

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    References listed on IDEAS

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    6. Chadha, Jagjit S. & Nolan, Charles, 2001. "Inflation Targeting, Transparency and Interest Rate Volatility: Ditching Monetary Mystique in the U.K," Journal of Macroeconomics, Elsevier, vol. 23(3), pages 349-366, July.
    7. William Poole & Robert H & Rasche & Daniel L. Thornton, 2002. "Market anticipations of monetary policy actions," Review, Federal Reserve Bank of St. Louis, issue Jul, pages 65-94.
    8. Nikolaos Panigirtzoglou & James Proudman & John Spicer, 2000. "Persistence and volatility in short-term interest rates," Bank of England working papers 116, Bank of England.
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    Cited by:

    1. Richard Harris, 2011. "Models Of Regional Growth: Past, Present And Future," Journal of Economic Surveys, Wiley Blackwell, vol. 25(5), pages 913-951, December.
    2. repec:eee:streco:v:42:y:2017:i:c:p:67-75 is not listed on IDEAS
    3. Duncan K. Foley & Thomas R. Michl, 2010. "The Classical Theory of Growth and Distribution," Chapters,in: Handbook of Alternative Theories of Economic Growth, chapter 2 Edward Elgar Publishing.
    4. Viego, Valentina, 2010. "Rendimientos crecientes, costos de transporte, eslabonamientos verticales y asimetrías regionales persistentes
      [Increasing returns, transport costs, vertical linkages and persistent regional inequa
      ," MPRA Paper 26881, University Library of Munich, Germany, revised 04 Aug 2010.
    5. Robert A. Blecker, 2009. "Long-Run Growth in Open Economies: Export-Led Cumulative Causation or a Balance-of-Payments Constraint?," Working Papers 2009-23, American University, Department of Economics.

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    growth; convergence; Kaldor;


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