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Economic Integration and Income Convergence: Not Such a Strong Link?

  • Branko Milanovic

    (Development Research Group, World Bank and Carnegie Endowment for International Peace)

We would expect that the process of globalization between 1870 and 1914 and subsequent disintegration of the world economy during the interwar period would have led first to income convergence and then to income divergence between the participating countries. But in fact we find stronger evidence for income convergence during the interwar period than during the first globalization. Similarly, the average level of import protection in the world cannot be shown to have either helped or hampered convergence. The evidence for trade-induced convergence is therefore weak. Copyright by the President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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Article provided by MIT Press in its journal The Review of Economics and Statistics.

Volume (Year): 88 (2006)
Issue (Month): 4 (November)
Pages: 659-670

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Handle: RePEc:tpr:restat:v:88:y:2006:i:4:p:659-670
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