IDEAS home Printed from https://ideas.repec.org/a/taf/regstd/v41y2007i4p531-541.html
   My bibliography  Save this article

Stochastic Convergence amongst Mexican States

Author

Listed:
  • Josep Lluis Carrion-I-Silvestre
  • Vicente German-Soto

Abstract

Carrion-i-Silvestre J. L. and GERMAN-SOTO V. (2007) Stochastic convergence amongst Mexican states, Regional Studies 41, 531-541. The paper investigates the convergence process experienced by the Mexican states in the period 1940-2001. The analysis indicates that misleading conclusions can be obtained if the presence of structural breaks is not taken into account when testing for the presence of (stochastic) convergence. Thus, after allowing for structural breaks evidence in favour of convergence, in terms of real per capita GDP, is found using both unit root and co-integration tests. Empirical evidence shows that economic convergence has changed over time with mixed effects, although changes were toward convergence in the majority of cases, consistent with stochastic convergence. Carrion-i-Silvestre J. L. et German-Soto V. (2007) La convergence stochastique parmi les etats au Mexique. Regional Studies 41, 531-541. Cet article cherche a examiner le processus de convergence aux etats mexicains entre 1940 et 2001. L'analyse laisse voir la possibilite de tirer des conclusions trompeuses si l'on ne tient pas compte de la presence des ruptures structurelles quand on fait des analyses pour determiner la presence de la convergence (stochastique). Ainsi, une fois tenu compte des ruptures structurelles, il s'avere des preuves en faveur de la convergence, en termes du PIB par tete reel, en employant a la fois des tests de racine unitaire et de cointegration. Des preuves empiriques montrent que la convergence economique a evolue dans le temps avec des effets mitiges, bien que l'evolution soit vers la convergence dans la plupart des cas, ce qui correspond a la convergence stochastique. Convergence stochastique Ruptures structurelles Racine unitaire Cointegration Changements de regime Carrion-i-Silvestre J. L. und German-Soto V. (2007) Stochastische Konvergenz in mexikanischen Staaten, Regional Studies 41, 531-541. In diesem Aufsatz untersuchen wir den Konvergenzprozess der mexikanischen Staaten im Zeitraum von 1940 bis 2001. Unsere Analyse zeigt, dass es zu irrefuhrenden Schlussfolgerungen fuhren kann, wenn bei der Uberprufung des Vorhandenseins einer (stochastischen) Konvergenz nicht das Vorhandensein struktureller Bruche berucksichtigt wird. Nach einer Berucksichtigung der strukturellen Bruche werden bei Einheitswurzeln- und Kointegrationstests Anzeichen fur eine Konvergenz hinsichtlich des realen Pro-Kopf-Bruttosozialprodukts gefunden. Die empirischen Belege weisen darauf hin, dass sich die wirtschaftliche Konvergenz im Laufe der Zeit geandert hat. Dies hat zu unterschiedlichen Auswirkungen gefuhrt, obwohl die Anderungen in den meisten Fallen zu einer Konvergenz tendierten und mit einer stochastischen Konvergenz ubereinstimmten. Stochastische Konvergenz Strukturelle Bruche Einheitswurzel Kointegration Regimeanderungen Carrion-i-Silvestre J. L. y German-Soto V. (2007) Convergencia estocastica en los estados mexicanos, Regional Studies 41, 531-541. En este articulo investigamos el proceso de convergencia experimentado por los estados mexicanos durante el periodo de 1940 a 2001. Nuestro analisis indica que si al comprobar la presencia de convergencia (estocastica) no se tiene en cuenta la presencia de recesos estructurales se puede llegar a conclusiones erroneas. Por tanto, despues de tener en cuenta los recesos estructurales, observamos pruebas a favor de la convergencia, en terminos de PIB real per capita, tanto si se usan tests de raices unitarias como de cointegracion. Las pruebas empiricas demuestran que con el tiempo la convergencia economica ha cambiado con efectos variados, aunque los cambios tendieron hacia la convergencia en la mayoria de los casos y concordaban con una convergencia estocastica. Convergencia estocastica Recesos estructurales Raiz unitaria Cointegracion Cambios de regimen

Suggested Citation

  • Josep Lluis Carrion-I-Silvestre & Vicente German-Soto, 2007. "Stochastic Convergence amongst Mexican States," Regional Studies, Taylor & Francis Journals, vol. 41(4), pages 531-541.
    • Handle: RePEc:taf:regstd:v:41:y:2007:i:4:p:531-541
    DOI: 10.1080/00343400601120221
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/00343400601120221
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/00343400601120221?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Perron, Pierre & Vogelsang, Timothy J., "undated". "Level Shifts and Purchasing Power Parity," Instructional Stata datasets for econometrics levshift, Boston College Department of Economics.
    2. Serge Coulombe, 2000. "New Evidence of Convergence Across Canadian Provinces: The Role of Urbanization," Regional Studies, Taylor & Francis Journals, vol. 34(8), pages 713-725.
    3. Chiquiar, Daniel, 2005. "Why Mexico's regional income convergence broke down," Journal of Development Economics, Elsevier, vol. 77(1), pages 257-275, June.
    4. Zivot, Eric & Andrews, Donald W K, 2002. "Further Evidence on the Great Crash, the Oil-Price Shock, and the Unit-Root Hypothesis," Journal of Business & Economic Statistics, American Statistical Association, vol. 20(1), pages 25-44, January.
    5. S. Dobson & C. Ramlogan, 2002. "Economic Growth and Convergence in Latin America," Journal of Development Studies, Taylor & Francis Journals, vol. 38(6), pages 83-104.
    6. Bernard, Andrew B & Durlauf, Steven N, 1995. "Convergence in International Output," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 10(2), pages 97-108, April-Jun.
    7. Montanes, Antonio & Olloqui, Irene & Calvo, Elena, 2005. "Selection of the break in the Perron-type tests," Journal of Econometrics, Elsevier, vol. 129(1-2), pages 41-64.
    8. Perron, Pierre & Vogelsang, Timothy J, 1992. "Nonstationarity and Level Shifts with an Application to Purchasing Power Parity," Journal of Business & Economic Statistics, American Statistical Association, vol. 10(3), pages 301-320, July.
    9. Sergio Rey & Brett Montouri, 1999. "US Regional Income Convergence: A Spatial Econometric Perspective," Regional Studies, Taylor & Francis Journals, vol. 33(2), pages 143-156.
    10. Barro, Robert J & Sala-i-Martin, Xavier, 1992. "Convergence," Journal of Political Economy, University of Chicago Press, vol. 100(2), pages 223-251, April.
      • Barro, R.J. & Sala-I-Martin, X., 1991. "Convergence," Papers 645, Yale - Economic Growth Center.
      • Barro, Robert J. & Sala-i-Martin, Xavier, 1992. "Convergence," Scholarly Articles 3451299, Harvard University Department of Economics.
    11. Gregory, Allan W. & Hansen, Bruce E., 1996. "Residual-based tests for cointegration in models with regime shifts," Journal of Econometrics, Elsevier, vol. 70(1), pages 99-126, January.
    12. Fingleton, Bernard, 1997. "Specification and Testing of Markov Chain Models: An Application to Convergence in the European Union," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 59(3), pages 385-403, August.
    13. Seamus Mcguinness & Maura Sheehan, 1998. "Regional convergence in the UK, 1970-1995," Applied Economics Letters, Taylor & Francis Journals, vol. 5(10), pages 653-658.
    14. Terence C. Mills & Ping Wang, 2003. "Have output growth rates stabilised? evidence from the g‐7 economies," Scottish Journal of Political Economy, Scottish Economic Society, vol. 50(3), pages 232-246, August.
    15. Paul Collier & Jan Willem Gunning, 1999. "Why Has Africa Grown Slowly?," Journal of Economic Perspectives, American Economic Association, vol. 13(3), pages 3-22, Summer.
    16. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 407-437.
    17. Efthymios Tsionas, 2000. "Regional Growth and Convergence: Evidence from the United States," Regional Studies, Taylor & Francis Journals, vol. 34(3), pages 231-238.
    18. Perron, Pierre, 1997. "Further evidence on breaking trend functions in macroeconomic variables," Journal of Econometrics, Elsevier, vol. 80(2), pages 355-385, October.
    19. Frank S.T. Hsiao & Mei‐Chu W. Hsiao, 2004. "Catching Up and Convergence: Long‐run Growth in East Asia," Review of Development Economics, Wiley Blackwell, vol. 8(2), pages 223-236, May.
    20. Strazicich, Mark C. & Lee, Junsoo & Day, Edward, 2004. "Are incomes converging among OECD countries? Time series evidence with two structural breaks," Journal of Macroeconomics, Elsevier, vol. 26(1), pages 131-145, March.
    21. Zhang, Zongyi & Liu, Aying & Yao, Shujie, 2001. "Convergence of China's regional incomes: 1952-1997," China Economic Review, Elsevier, vol. 12(2-3), pages 243-258.
    22. Javier Sánchez‐Reaza & Andrés Rodríguez‐Pose, 2002. "The Impact of Trade Liberalization on Regional Disparities in Mexico," Growth and Change, Wiley Blackwell, vol. 33(1), pages 72-90.
    23. 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.
    24. Robin L. Lumsdaine & David H. Papell, 1997. "Multiple Trend Breaks And The Unit-Root Hypothesis," The Review of Economics and Statistics, MIT Press, vol. 79(2), pages 212-218, May.
    25. Perron, Pierre, 1989. "The Great Crash, the Oil Price Shock, and the Unit Root Hypothesis," Econometrica, Econometric Society, vol. 57(6), pages 1361-1401, November.
    26. 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.
    27. Carlos R. Azzoni, 2001. "Economic growth and regional income inequality in Brazil," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 35(1), pages 133-152.
    28. Serena Ng & Pierre Perron, 2001. "LAG Length Selection and the Construction of Unit Root Tests with Good Size and Power," Econometrica, Econometric Society, vol. 69(6), pages 1519-1554, November.
    29. Gregory, Allan W & Hansen, Bruce E, 1996. "Tests for Cointegration in Models with Regime and Trend Shifts," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 58(3), pages 555-560, August.
    30. Persson, Joakim, 1997. "Convergence across the Swedish counties, 1911-1993," European Economic Review, Elsevier, vol. 41(9), pages 1835-1852, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rok Spruk, 2021. "Regional convergence and trade liberalization under weak state capacity: evidence from Mexico," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 18(2), pages 173-216, December.
    2. Antonio Montanes & Lorena Olmos & Marcelo Reyes, 2015. "Convergence in Spanish provinces," ERSA conference papers ersa15p1188, European Regional Science Association.
    3. Josep Carrion-i-Silvestre & Vicente German-Soto, 2010. "Stochastic convergence in the industrial sector of the Mexican states," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 45(3), pages 547-570, December.
    4. Johan Lyhagen & Johanna Rickne, 2014. "Income inequality between Chinese regions: newfound harmony or continued discord?," Empirical Economics, Springer, vol. 47(1), pages 93-110, August.
    5. Montañés, Antonio & Olmos, Lorena & Reyes, Marcelo, 2018. "Has the Great Recession affected the convergence process? The case of Spanish provinces," Economic Modelling, Elsevier, vol. 68(C), pages 360-371.
    6. Georges Harb & Charbel Bassil, 2023. "TFP in the Manufacturing Sector: Long-Term Dynamics, Country and Regional Comparative Analysis," Economies, MDPI, vol. 11(2), pages 1-22, January.
    7. A. Monta & L. Olmos, 2014. "Do the Spanish regions converge? A unit root analysis for the HDI of the Spanish regions," Applied Economics, Taylor & Francis Journals, vol. 46(34), pages 4218-4230, December.
    8. Maria Jesus Herrerias & Vicente Orts, 2011. "The driving forces behind China’s growth," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 19(1), pages 79-124, January.
    9. René Cabral & André Mollick, 2012. "Mexico’s regional output convergence after NAFTA: a dynamic panel data analysis," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 48(3), pages 877-895, June.
    10. Domingo Rodríguez Benavides & Miguel Ángel Mendoza González & Jose Antonio Climent Hernández, 2022. "La hipótesis de convergencia en México: un enfoque de sigma-convergencia débil," Remef - Revista Mexicana de Economía y Finanzas Nueva Época REMEF (The Mexican Journal of Economics and Finance), Instituto Mexicano de Ejecutivos de Finanzas, IMEF, vol. 17(2), pages 1-21, Abril - J.
    11. Matthieu Clément & Lucie Piaser, 2022. "Geography of Income and Education Inequalities in Mexico: Evidence from Small Area Estimation and Exploratory Spatial Analysis," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(2), pages 703-732, April.
    12. Maryam Ishaq, 2020. "Regional Economic Integration and Productivity Convergence: Empirical Evidence from East Asia," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 25(2), pages 23-53, July-Dec.
    13. Burcu Ozcan, 2014. "Does Income Converge among EU Member Countries following the Post-War Period? Evidence from the PANKPSS Test," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(3), pages 22-38, October.
    14. Juan Gabriel Brida & Juan Pereyra & Martín Puchet Anyul & Wiston Adrián Risso, 2011. "Regímenes de desempeño económico y dualismo estructural en la dinámica de las entidades federativas de México, 1970 - 2006," Documentos de Trabajo (working papers) 1011, Department of Economics - dECON.
    15. Josep Carrion-i-Silvestre & Vicente German-Soto, 2009. "Panel data stochastic convergence analysis of the Mexican regions," Empirical Economics, Springer, vol. 37(2), pages 303-327, October.
    16. Alfonso Mendoza-Velázquez & Daniel Ventosa-Santaulària & Vicente Germán-Soto, 2019. "Mexico’s inter-regional inequality: a convergent process?," Empirical Economics, Springer, vol. 56(5), pages 1683-1705, May.
    17. Gil, Jose M. & Montañés, Antonio & Vásquez-González, Bernardo, 2023. "Are prices converging in the global sawnwood market?," Forest Policy and Economics, Elsevier, vol. 155(C).
    18. Montañés, Antonio & Olmos, Lorena & Reyes, Marcelo, 2016. "Does crisis affect convergence process? The case of the Spanish provinces," MPRA Paper 69543, University Library of Munich, Germany.
    19. Vicente German-Soto & Luis Gutiérrez Flores, 2010. "Time Series Tests of Structural Change among Innovation and Trade Liberalization in Mexico," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 1(3), pages 219-237, September.
    20. Kris Ivanovski & Sefa Awaworyi Churchill & John Inekwe, 2020. "Convergence in Income Inequality Across Australian States and Territories," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 148(1), pages 127-142, February.
    21. Ferreira Paulo & Dionísio Andreia, 2016. "GDP growth and convergence determinants in the European Union: a crisp-set analysis," Review of Economic Perspectives, Sciendo, vol. 16(4), pages 279-296, December.
    22. Brock, Gregory & German-Soto, Vicente, 2013. "Regional industrial growth in Mexico: Do human capital and infrastructure matter?," Journal of Policy Modeling, Elsevier, vol. 35(2), pages 228-242.
    23. Wallace, Frederick & Chapa Cantú, Joana, 2015. "The Ejido System and Economic Growth of the Mexican States," MPRA Paper 62261, University Library of Munich, Germany.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Josep Carrion-i-Silvestre & Vicente German-Soto, 2010. "Stochastic convergence in the industrial sector of the Mexican states," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 45(3), pages 547-570, December.
    2. Cunado, J. & Perez de Gracia, F., 2006. "Real convergence in Africa in the second-half of the 20th century," Journal of Economics and Business, Elsevier, vol. 58(2), pages 153-167.
    3. Brittle, Shane, 2009. "Ricardian Equivalence and the Efficacy of Fiscal Policy in Australia," Economics Working Papers wp09-10, School of Economics, University of Wollongong, NSW, Australia.
    4. Matsuki, Takashi, 2019. "Per capita output convergence across Asian countries: Evidence from covariate unit root test with an endogenous structural break," Economic Modelling, Elsevier, vol. 82(C), pages 99-118.
    5. Antonio Montanes & Lorena Olmos & Marcelo Reyes, 2015. "Convergence in Spanish provinces," ERSA conference papers ersa15p1188, European Regional Science Association.
    6. A. F. Galvao Jr & F. A. Reis Gomes, 2007. "Convergence or divergence in Latin America? A time series analysis," Applied Economics, Taylor & Francis Journals, vol. 39(11), pages 1353-1360.
    7. A. Monta & L. Olmos, 2014. "Do the Spanish regions converge? A unit root analysis for the HDI of the Spanish regions," Applied Economics, Taylor & Francis Journals, vol. 46(34), pages 4218-4230, December.
    8. repec:kap:iaecre:v:17:y:2011:i:3:p:315-333 is not listed on IDEAS
    9. Strazicich, Mark C. & Lee, Junsoo & Day, Edward, 2004. "Are incomes converging among OECD countries? Time series evidence with two structural breaks," Journal of Macroeconomics, Elsevier, vol. 26(1), pages 131-145, March.
    10. Travaglini, Guido, 2007. "The U.S. Dynamic Taylor Rule With Multiple Breaks, 1984-2001," MPRA Paper 3419, University Library of Munich, Germany, revised 15 Jun 2007.
    11. Eftychia Tsanana & Constantinos Katrakilidis, 2014. "Do Balkan economies catch up with EU? New evidence from panel unit root analysis," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 41(4), pages 641-662, November.
    12. Steven Cook, 2008. "An alternative perspective on the stochastic convergence of incomes in the United States," Applied Economics Letters, Taylor & Francis Journals, vol. 15(12), pages 929-934.
    13. Giorgio Canarella & Stephen Miller & Stephen Pollard, 2011. "The Global Financial Crisis and Stochastic Convergence in the Euro Area," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 17(3), pages 315-333, August.
    14. Juncal Cunado & Fernando Perez de Gracia, 2006. "Real convergence in some Central and Eastern European countries," Applied Economics, Taylor & Francis Journals, vol. 38(20), pages 2433-2441.
    15. Li, Qing & Papell, David, 1999. "Convergence of international output Time series evidence for 16 OECD countries," International Review of Economics & Finance, Elsevier, vol. 8(3), pages 267-280, September.
    16. Dakpogan, Arnaud & Smit, Eon, 2018. "The effect of electricity losses on GDP in Benin," MPRA Paper 89545, University Library of Munich, Germany.
    17. Cumhur ÞAHÝN & Hüseyin ALTAY, 2016. "Examination of the Relationship between Turkey’s Credit Default Swap (CDS) Points and Unemployment," Eurasian Business & Economics Journal, Eurasian Academy Of Sciences, vol. 4(4), pages 52-67, January.
    18. Adewuyi, Adeolu O. & Ogebe, Joseph O., 2019. "The validity of uncovered interest parity: Evidence from african members and non-member of the organisation of petroleum exporting countries (OPEC)," Economic Modelling, Elsevier, vol. 82(C), pages 229-249.
    19. Monojit Chatterji & Homagni Choudhury, 2010. "The Changing Inter-Industry Wage Structure of the Organised Manufacturing Sector in India, 1973-74 to 2003-04," Dundee Discussion Papers in Economics 244, Economic Studies, University of Dundee.
    20. Stephen Dobson & Carlyn Ramlogan & Eric Strobl, 2006. "Why Do Rates Of Β‐Convergence Differ? A Meta‐Regression Analysis," Scottish Journal of Political Economy, Scottish Economic Society, vol. 53(2), pages 153-173, May.
    21. Paleologou, Suzanna-Maria, 2013. "Asymmetries in the revenue–expenditure nexus: A tale of three countries," Economic Modelling, Elsevier, vol. 30(C), pages 52-60.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:regstd:v:41:y:2007:i:4:p:531-541. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CRES20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.