Convergence analysis: a new approach
Economic growth and convergence is one of the most discussed fields in economics, as the long-run growth basically determines the welfare of countries. On the basis of neoclassical growth models, countries with lower GDP per capita will tend to grow faster than richer ones. However, convergence is not always confirmed. This means that economies are converging but the steady-state level is not always common, so countries may converge to different / own level of steady-states. At the same time, the term ‘convergence’ can be interpreted by different ways. Therefore, multiple methods have to be applied to measure processes of convergence or divergence in a comprehensive way. In this paper an indicator, called omega is presented in order to calculate convergence/divergence by a new approach. Omega is an adjusted weighted standard deviation of economic development (catching-up), which can be calculated on a single or multivariate basis. The paper is organized as following. Section 1 briefly describes the definition and methodology of convergence. Section 2 outlines the model. In section 3 different types of convergence indicators are analysed and compared. Section 4 concludes.
|Date of creation:||2012|
|Date of revision:|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Sala-i-Martin, Xavier X, 1996.
"The Classical Approach to Convergence Analysis,"
Royal Economic Society, vol. 106(437), pages 1019-36, July.
- Sala-i-martin, X., 1995. "The Classical Approach to Convergence Analysis," Papers 734, Yale - Economic Growth Center.
- Xavier Sala-i-Martin, 1995. "The classical approach to convergence analysis," Economics Working Papers 117, Department of Economics and Business, Universitat Pompeu Fabra.
- Sala-i-Martin, Xavier, 1995. "The Classical Approach to Convergence Analysis," CEPR Discussion Papers 1254, C.E.P.R. Discussion Papers.
- Sala-i-Martin, Xavier, 1994.
"Regional Cohesion: Evidence and Theories of Regional Growth and Convergence,"
CEPR Discussion Papers
1075, C.E.P.R. Discussion Papers.
- Sala-i-Martin, Xavier X., 1996. "Regional cohesion: Evidence and theories of regional growth and convergence," European Economic Review, Elsevier, vol. 40(6), pages 1325-1352, June.
- Xavier Sala-i-Martin, 1994. "Regional cohesion: Evidence and theories of regional growth and convergence," Economics Working Papers 104, Department of Economics and Business, Universitat Pompeu Fabra.
- Galor, Oded, 1996.
"Convergence? Inferences from Theoretical Models,"
CEPR Discussion Papers
1350, C.E.P.R. Discussion Papers.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:40363. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter)
If references are entirely missing, you can add them using this form.