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Income convergence: fresh evidence from the Nordic countries

Author

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  • Liew, Venus Khim-Sen
  • Ahmad, Yusuf

Abstract

Using the recently developed linearity test and non-linear unit root test, this study shows that the income gaps of Finland, Norway and Sweden with respect to Denmark are non-linear but stationary with no significant trend effect, implying the Nordic countries have already attained steady state of income equality, a state beyond catching up as identified earlier in Oxley and Greasley (1999). This fresh evidence strengthens the finding of Nordic Convergence Club by these authors.

Suggested Citation

  • Liew, Venus Khim-Sen & Ahmad, Yusuf, 2006. "Income convergence: fresh evidence from the Nordic countries," MPRA Paper 3637, University Library of Munich, Germany, revised Mar 2007.
  • Handle: RePEc:pra:mprapa:3637
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    File URL: https://mpra.ub.uni-muenchen.de/3637/1/MPRA_paper_3637.pdf
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    References listed on IDEAS

    as
    1. Kapetanios, George & Shin, Yongcheol & Snell, Andy, 2003. "Testing for a unit root in the nonlinear STAR framework," Journal of Econometrics, Elsevier, vol. 112(2), pages 359-379, February.
    2. repec:ebl:ecbull:v:15:y:2005:i:1:p:1-7 is not listed on IDEAS
    3. Venus Khim-Sen Liew & Kian-Ping Lim, 2005. "Income Divergence? Evidence of Non-linearity in the East Asian Economies," Economics Bulletin, AccessEcon, vol. 15(1), pages 1-7.
    4. Dirk Te Velde, 2001. "Balance of payments prospects in EMU," National Institute of Economic and Social Research (NIESR) Discussion Papers 178, National Institute of Economic and Social Research.
    5. Les Oxley & David Greasley, 1999. "A Nordic convergence club?," Applied Economics Letters, Taylor & Francis Journals, vol. 6(3), pages 157-160.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Liew, Venus Khim-Sen, 2008. "An overview on various ways of bootstrap methods," MPRA Paper 7163, University Library of Munich, Germany.

    More about this item

    Keywords

    Income Convergence; Nordic Countries; Nonlinear; Linearity; Catching Up; Long-run convergence;

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General

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