IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Heterogeneous Convergence

  • Young, Andrew
  • Higgins, Matthew
  • Levy, Daniel

We use US county-level data containing 3,058 cross-sectional observations and 41 conditioning variables to study economic growth and explore possible heterogeneity in growth determination across 32 individual states. Using a 3SLS-IV estimation method, we find that the convergence rates for 32 individual states are above 2 percent, with an average of 8.1 percent. For 7 states the convergence rate can be rejected as identical to at least one other state’s convergence rate with 95 percent confidence. Convergence rates are negatively correlated with initial income. The size of government at all levels of decentralization is either unproductive or negatively correlated with growth. Educational attainment has a non-linear relationship with growth. The size of the finance, insurance and real estate, and entertainment industries are positively correlated with growth, while the size of the education industry is negatively correlated with growth. Heterogeneity in the effects of balanced growth path determinants across individual states is harder to detect than in convergence rates.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: https://mpra.ub.uni-muenchen.de/954/1/MPRA_paper_954.pdf
File Function: original version
Download Restriction: no

File URL: https://mpra.ub.uni-muenchen.de/46038/8/MPRA_paper_46038.pdf
File Function: revised version
Download Restriction: no

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 954.

as
in new window

Length:
Date of creation: 25 Oct 2006
Date of revision:
Handle: RePEc:pra:mprapa:954
Contact details of provider: Postal: Schackstr. 4, D-80539 Munich, Germany
Phone: +49-(0)89-2180-2219
Fax: +49-(0)89-2180-3900
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.:

as in new window
  1. Daniel Levy & Hashem Dezhbakhsh, 2002. "International Evidence on Output Fluctuation and Shock Persistence," Working Papers 2002-17, Bar-Ilan University, Department of Economics.
  2. Rappaport, Jordan, 2004. "Why are population flows so persistent?," Journal of Urban Economics, Elsevier, vol. 56(3), pages 554-580, November.
  3. Barro, Robert J & Mankiw, N Gregory & Sala-i-Martin, Xavier, 1995. "Capital Mobility in Neoclassical Models of Growth," American Economic Review, American Economic Association, vol. 85(1), pages 103-15, March.
  4. Matthew J. Higgins & Andrew T. Young & Daniel Levy, 2010. "Robust correlates of county-level growth in the United States," Applied Economics Letters, Taylor & Francis Journals, vol. 17(3), pages 293-296, February.
  5. King, Robert G. & Levine, Ross, 1993. "Finance and growth : Schumpeter might be right," Policy Research Working Paper Series 1083, The World Bank.
  6. Matthew Higgins & Daniel Levy & Andrew Young, 2005. "Growth and Convergence across the U.S: Evidence from County-Level Data," Macroeconomics 0509023, EconWPA.
  7. Stephen Bond & Anke Hoeffler & Jonathan Temple, 2001. "GMM Estimation of Empirical Growth Models," Economics Papers 2001-W21, Economics Group, Nuffield College, University of Oxford.
  8. Fölster, Stefan & Henrekson, Magnus, 2000. "Growth Effects of Government Expenditure and Taxation in Rich Countries," SSE/EFI Working Paper Series in Economics and Finance 391, Stockholm School of Economics.
  9. Robert J. Barro, 1989. "Economic Growth in a Cross Section of Countries," NBER Working Papers 3120, National Bureau of Economic Research, Inc.
  10. Evans, P, 1996. "Using Panel Data to Evaluate Growth Theories," ISER Discussion Paper 0397, Institute of Social and Economic Research, Osaka University.
  11. Brian J. Surette, 1997. "The effects of two-year college on the labor market and schooling experiences of young men," Finance and Economics Discussion Series 1997-44, Board of Governors of the Federal Reserve System (U.S.).
  12. Durlauf, Steven N. & Kourtellos, Andros & Minkin, Artur, 2001. "The local Solow growth model," European Economic Review, Elsevier, vol. 45(4-6), pages 928-940, May.
  13. Allen N. Berger & Anil K. Kashyap & Joseph M. Scalise, 1995. "The Transformation of the U.S. Banking Industry: What a Long, Strange Trips It's Been," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(2), pages 55-218.
  14. Matthew J. Higgins & Daniel Levy & Andrew T. Young, 2006. "Federal, State, and Local Governments: Evaluating Their Separate Roles in U.S. Growth," Emory Economics 0614, Department of Economics, Emory University (Atlanta).
  15. Rappaport, J., 2000. "Local Growth Empirics," Papers 23, Chicago - Graduate School of Business.
  16. Andrew T. Young & Matthew J. Higgins & Daniel Levy, 2003. "Sigma Convergence Versus Beta Convergence: Evidence from U.S. County-Level Data," Working Papers 2003-06, Bar-Ilan University, Department of Economics.
  17. Danny Quah, 1996. "Twin Peaks: Growth and Convergence in Models of Distribution Dynamics," CEP Discussion Papers dp0280, Centre for Economic Performance, LSE.
  18. Daniel Levy, 2003. "Is the Feldstein-Horioka Puzzle Really a Puzzle?," Working Papers 2003-02, Bar-Ilan University, Department of Economics.
  19. Durlauf, S.M. & Johnson, P.A., 1995. "Multiple Regimes and Cross-Country Growth Behavior," Working papers 9419r, Wisconsin Madison - Social Systems.
  20. Jordan Rappaport, 2000. "Is the speed of convergence constant?," Research Working Paper RWP 00-10, Federal Reserve Bank of Kansas City.
  21. Paul Evans, 1997. "How Fast Do Economies Converge?," The Review of Economics and Statistics, MIT Press, vol. 79(2), pages 219-225, May.
  22. N. Gregory Mankiw & David Romer & David N. Weil, 1990. "A Contribution to the Empirics of Economic Growth," NBER Working Papers 3541, National Bureau of Economic Research, Inc.
  23. Jordan Rappaport, 1999. "How does labor mobility affect income convergence?," Research Working Paper 99-12, Federal Reserve Bank of Kansas City.
  24. Driscoll, John C., 2004. "Does bank lending affect output? Evidence from the U.S. states," Journal of Monetary Economics, Elsevier, vol. 51(3), pages 451-471, April.
  25. Gernot Doppelhofer & Ronald I. Miller & Xavier Sala-i-Martin, 2000. "Determinants of Long-Term Growth: A Bayesian Averaging of Classical Estimates (BACE) Approach," NBER Working Papers 7750, National Bureau of Economic Research, Inc.
  26. Quah, Danny T, 1997. " Empirics for Growth and Distribution: Stratification, Polarization, and Convergence Clubs," Journal of Economic Growth, Springer, vol. 2(1), pages 27-59, March.
  27. Conley, T. G., 1999. "GMM estimation with cross sectional dependence," Journal of Econometrics, Elsevier, vol. 92(1), pages 1-45, September.
  28. Andrew Harvey (ed.), 1994. "Time Series," Books, Edward Elgar, volume 0, number 599, March.
  29. Dezhbakhsh, Hashem & Levy, Daniel, 1994. "Periodic properties of interpolated time series," Economics Letters, Elsevier, vol. 44(3), pages 221-228.
  30. Levine, Ross & Renelt, David, 1991. "A sensitivity analysis of cross-country growth regressions," Policy Research Working Paper Series 609, The World Bank.
  31. Evans, Paul & Karras, Georgios, 1994. "Is government capital productive? Evidence from a panel of seven countries," Journal of Macroeconomics, Elsevier, vol. 16(2), pages 271-279.
  32. 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.
  33. Greenwood, J. & Jovanovic, B., 1990. "Financial Development, Growth, And The Distribution Of Income," University of Western Ontario, The Centre for the Study of International Economic Relations Working Papers 9002, University of Western Ontario, The Centre for the Study of International Economic Relations.
  34. 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.
  35. Walker, Douglas M. & Jackson, John D., 1998. "New Goods and Economic Growth: Evidence from Legalized Gambling," The Review of Regional Studies, Southern Regional Science Association, vol. 28(2), pages 47-70, Fall.
  36. Dani Rodrik, 2013. "Unconditional Convergence in Manufacturing," The Quarterly Journal of Economics, Oxford University Press, vol. 128(1), pages 165-204.
  37. Rousseau, Peter L & Wachtel, Paul, 1998. "Financial Intermediation and Economic Performance: Historical Evidence from Five Industrialized Countries," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 30(4), pages 657-78, November.
  38. Islam, Nazrul, 1995. "Growth Empirics: A Panel Data Approach," The Quarterly Journal of Economics, MIT Press, vol. 110(4), pages 1127-70, November.
  39. Michael Marlow, 2001. "Bureaucracy and student performance in US public schools," Applied Economics, Taylor & Francis Journals, vol. 33(10), pages 1341-1350.
  40. Quah, Danny, 1996. "Twin Peaks: Growth and Convergence in Models of Distribution Dynamics," CEPR Discussion Papers 1355, C.E.P.R. Discussion Papers.
  41. Danny Quah, 1996. "Twin peaks : growth and convergence in models of distribution dynamics," LSE Research Online Documents on Economics 2278, London School of Economics and Political Science, LSE Library.
  42. William Easterly & Sergio Rebelo, 1993. "Fiscal Policy and Economic Growth: An Empirical Investigation," NBER Working Papers 4499, National Bureau of Economic Research, Inc.
  43. Jordan Rappaport, 2003. "Moving to nice weather," Research Working Paper RWP 03-07, Federal Reserve Bank of Kansas City.
  44. Canova, Fabio, 1999. "Testing for Convergence Clubs in Income per-capita: A Predictive Density Approach," CEPR Discussion Papers 2201, C.E.P.R. Discussion Papers.
  45. repec:chb:bcchwp:03 is not listed on IDEAS
  46. John J. Siegfried & Andrew Zimbalist, 2000. "The Economics of Sports Facilities and Their Communities," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 95-114, Summer.
  47. Rappaport, Jordan & Sachs, Jeffrey D, 2003. " The United States as a Coastal Nation," Journal of Economic Growth, Springer, vol. 8(1), pages 5-46, March.
  48. Barro, Robert J & Sala-i-Martin, Xavier, 1992. "Convergence," Journal of Political Economy, University of Chicago Press, vol. 100(2), pages 223-51, April.
  49. Agrawal, Ajay & Cockburn, Iain, 2003. "The anchor tenant hypothesis: exploring the role of large, local, R&D-intensive firms in regional innovation systems," International Journal of Industrial Organization, Elsevier, vol. 21(9), pages 1227-1253, November.
  50. Dora L. Costa, 1997. "Less of a Luxury: The Rise of Recreation since 1888," NBER Working Papers 6054, National Bureau of Economic Research, Inc.
  51. William R. Eadington, 1999. "The Economics of Casino Gambling," Journal of Economic Perspectives, American Economic Association, vol. 13(3), pages 173-192, Summer.
  52. Bliss, Christopher, 1999. "Galton's Fallacy and Economic Convergence," Oxford Economic Papers, Oxford University Press, vol. 51(1), pages 4-14, January.
  53. Evans, Paul & Karras, Georgios, 1994. "Are Government Activities Productive? Evidence from a Panel of U.S. States," The Review of Economics and Statistics, MIT Press, vol. 76(1), pages 1-11, February.
  54. Kane, Thomas J & Rouse, Cecilia Elena, 1995. "Labor-Market Returns to Two- and Four-Year College," American Economic Review, American Economic Association, vol. 85(3), pages 600-614, June.
  55. Quah, Danny, 1997. "Empirics for Growth and Distribution: Stratification, Polarization, and Convergence Clubs," CEPR Discussion Papers 1586, C.E.P.R. Discussion Papers.
  56. Desdoigts, Alain, 1999. " Patterns of Economic Development and the Formation of Clubs," Journal of Economic Growth, Springer, vol. 4(3), pages 305-30, September.
  57. Daniel Levy, 2000. "Investment-Saving Comovement and Capital Mobility: Evidence from Century Long U.S. Time Series," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 3(1), pages 100-137, January.
  58. Sherrill Shaffer, 2006. "Establishment Size by Sector and County-Level Economic Growth," Small Business Economics, Springer, vol. 26(2), pages 145-154, 03.
  59. King, Robert G. & Levine, Ross, 1993. "Finance and growth : Schumpeter might be right," Policy Research Working Paper Series 1083, The World Bank.
  60. Caselli, Francesco & Esquivel, Gerardo & Lefort, Fernando, 1996. " Reopening the Convergence Debate: A New Look at Cross-Country Growth Empirics," Journal of Economic Growth, Springer, vol. 1(3), pages 363-89, September.
  61. Stephen Bond & Anke Hoeffler, 2001. "GMM Estimation of Empirical Growth Models," Economics Series Working Papers 2001-W21, University of Oxford, Department of Economics.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:954. 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: (Ekkehart Schlicht)

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.