IDEAS home Printed from
   My bibliography  Save this paper

Club Convergence & Regional Spillovers In East Java


  • Rummaya

    (Faculty of Economics, Airlangga University)

  • Wirya Wardaya

    (Faculty of Economics, Airlangga University)

  • Erlangga Agustino Landiyanto

    (Faculty of Economics, Airlangga University)


This study try to identify the â-convergence process among regions in East Java using panel data of 37 regencies & municipalities between 1983-2002, taking into account the presence of spatial heterogeneity and spillover effects. Detection of spatial regimes using G-I* statistics (Getis & Ord, 1995) on regional per capita GDP values in 1983 found cluster of high income regions (group of “rich”) in central & eastern part of East Java, and cluster of low income regions (group of “poor”) in western part. The result of OLS & GLS regression on absolute convergence model found the existence of â-divergence process of East Java in overall period (1983-2003), consistent with the ó convergence which showing upward trend (divergence). Meanwhile, the same divergence process is also found in absolute convergence equation estimated for each club, even though in slower rate than East Java divergence rate. Using the methodology proposed by Burn, Combes, & Renard (2002) this study founds the existence of negative spillover effects between regions in “rich” clubs and from “rich” clubs to the “poor” one, where the magnitude is greater in the latter case. The club of “poor” regions is diverging faster than the “rich”. This finding is robust in every convergence equation (with or without the spillover effects). The lack of diversity on East Java’s manufacturing industries (Santosa & Michael, 2005 and Landiyanto, 2005) seems contribute to its divergence process by engaging a competitive mode between regions.

Suggested Citation

  • Rummaya & Wirya Wardaya & Erlangga Agustino Landiyanto, 2005. "Club Convergence & Regional Spillovers In East Java," GE, Growth, Math methods 0511008, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpge:0511008
    Note: Type of Document - pdf; pages: 23

    Download full text from publisher

    File URL:
    Download Restriction: no


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Jennifer Day & Peter Ellis, 2013. "Growth in Indonesia's manufacturing sectors: Urban and localization contributions," Regional Science Policy & Practice, Wiley Blackwell, vol. 5(3), pages 343-368, August.
    2. Ewa Lechman, 2012. "Catching-Up And Club Convergence From Cross-National Perspective A Statistical Study For The Period 1980-2010," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 7(3), pages 95-109, September.

    More about this item


    â-convergence; divergence; spatial regimes; spillover effects;

    JEL classification:

    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • D9 - Microeconomics - - Micro-Based Behavioral Economics

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpge:0511008. 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: (EconWPA). General contact details of provider: .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.