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Regional Cohesion: Evidence and Theories of Regional Growth and Convergence

  • Sala-i-Martin, Xavier

After arguing that the concepts of b-convergence and s-convergence are independently interesting, this paper extends the empirical evidence on regional growth and convergence across the United States, Japan, and five European nations. We confirm that the estimated speeds of convergence are surprisingly similar across data sets: regions tend to converge at a speed of approximately 2% per year. We also show that the inter-regional distribution of income in all countries has shrunk over time. We then argue that, among the proposed potential explanations of this phenomenon, the one-sector neoclassical growth model and the hypothesis of technological diffusion seem to be the only ones which survive scrutiny.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 1075.

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Date of creation: Nov 1994
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Handle: RePEc:cpr:ceprdp:1075
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  1. Sergio T. Rebelo, 1990. "Long Run Policy Analysis and Long Run Growth," NBER Working Papers 3325, National Bureau of Economic Research, Inc.
  2. Etsuro Shioji, 1992. "Regional growth in Japan," Economics Working Papers 138, Department of Economics and Business, Universitat Pompeu Fabra, revised Oct 1995.
  3. Barro, R.J., 1989. "Economic Growth In A Cross Section Of Countries," RCER Working Papers 201, University of Rochester - Center for Economic Research (RCER).
  4. Robert J. Barro, 1995. "Inflation and Economic Growth," NBER Working Papers 5326, National Bureau of Economic Research, Inc.
  5. Barro, Robert J & Becker, Gary S, 1989. "Fertility Choice in a Model of Economic Growth," Econometrica, Econometric Society, vol. 57(2), pages 481-501, March.
  6. Gary S. Becker & Robert J. Barro, 1986. "A Reformulation of the Economic Theory of Fertility," NBER Working Papers 1793, National Bureau of Economic Research, Inc.
  7. Coulombe, S. & Lee, F.C., 1993. "Regional Economic Disparities in Canada," Working Papers 9317e, University of Ottawa, Department of Economics.
  8. Baumol, William J, 1986. "Productivity Growth, Convergence, and Welfare: What the Long-run Data Show," American Economic Review, American Economic Association, vol. 76(5), pages 1072-85, December.
  9. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-37, October.
  10. Barro, R.J. & Sala-I-Martin, X., 1991. "Convergence Across States and Regions," Papers 629, Yale - Economic Growth Center.
  11. Friedman, Milton, 1992. "Do Old Fallacies Ever Die?," Journal of Economic Literature, American Economic Association, vol. 30(4), pages 2129-32, December.
  12. Barro, Robert J. & Mankiw, N Gregory & Sala-i-Martin, Xavier, 1994. "Capital Mobility in Neoclassical Models of Growth," CEPR Discussion Papers 1019, C.E.P.R. Discussion Papers.
  13. Quah, Danny T., 1996. "Empirics for economic growth and convergence," European Economic Review, Elsevier, vol. 40(6), pages 1353-1375, June.
  14. Mankiw, N Gregory & Romer, David & Weil, David N, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 107(2), pages 407-37, May.
  15. Dolado, Juan J & Goria, Alessandra & Ichino, Andrea, 1994. "Immigration, Human Capital and Growth in the Host Country: Evidence from Pooled Country Data," Journal of Population Economics, Springer, vol. 7(2), pages 193-215.
  16. Quah, Danny, 1993. " Galton's Fallacy and Tests of the Convergence Hypothesis," Scandinavian Journal of Economics, Wiley Blackwell, vol. 95(4), pages 427-43, December.
  17. T. W. Swan, 1956. "ECONOMIC GROWTH and CAPITAL ACCUMULATION," The Economic Record, The Economic Society of Australia, vol. 32(2), pages 334-361, November.
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