Mavroudeas, Stavros and Siriopoulos, Costas (1998): Τesting convergence and divergence: the data from Greece. Published in: Journal of Applied Business Research , Vol. 14, No. 1 (1998)
Download (125kB) | Preview
The convergence hypothesis is a popular tenet in modern discussions in macroeconomics and regional economics. It derives from the very fundamental properties of the neoclassical single-sector growth model, and its assumption of diminishing returns to scale. Following this theoretical framework a number of empirical tests (σ or unconditional β or conditional β-convergence) has been developed. This paper tests unconditional and conditional β-convergence for the Greek economy. Three issues are being considered: (i)if there is regional convergence, (ii) if there is a North-Southern divide, (iii) if Greece is converging with the other economies taking part in the European integration project. Our empirical results reject the convergence hypothesis in all cases. These findings, together with similar findings for many other economies, pose significant problems for the theoretical assumptions of the neoclassical growth model with exogenous technical change.
|Item Type:||MPRA Paper|
|Original Title:||Τesting convergence and divergence: the data from Greece|
|Keywords:||convergence; neoclassical theory; Greece|
|Subjects:||R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R15 - Econometric and Input-Output Models; Other Models
R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R11 - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
|Depositing User:||Professor Stavros Mavroudeas|
|Date Deposited:||19. Sep 2010 02:19|
|Last Modified:||11. Feb 2013 10:48|
1. Abramovitz M., 'Catc-up and convergence in the postwar growth boom and after', in Baumol et al., 'Convergence of productivity; Cross-national studies and historical evidence', Oxford University Press, 1994
2. Barro, R.J. and X. Sala-i-Martin, 'Convergence Across States and Regions', Brookings Papers on Economic Activity no.1, pp. 107-182, 1991.
3. Baumol, W., 'Productivity, Growth, Convergence and Welfare: What the Long-Run Data Show', American Economic Review, 76, 5, pp. 1872-1085, 1986.
4. Baumol W., 'Multivariate growth patterns: contagion and common forces as possible sources of convergence' in Baumol W. et al. (eds.), 'Convergence of Productivity: Cross-National Studies and Historical Evidence', Oxford University Press, 1994
5. Bernard and Durlauf (1995)
6. Button K. and E. Pentecost, 'Testing for Convergence of the EU Regional Economies', Economic Inquiry, 33, (4), pp. 664-671, 1995.
7. Cashin P., 'Economic Growth and Convergence Across the Seven Colonies of Australia: 1861-1991', Economic Record, 71, (213), pp. 132-144, 1995.
8. Coulombe S. and F. Lee, 'Convergence Across Canadian Provinces, 1961 to 1991', Canadian Journal of Economics, 28 (4a), pp. 886-898, 1995.
9. De Long B., 'Productivity, Growth, Convergence and Welfare: Comment' American Economic Review, Vol. 78, n. 5, pp. 1138-1154, 1988.
10. Kottis G., 'Industrial decentralisation and regional development', Institute of Economic and Industrial Research, Athens
11. Labrianidis L., Papamichos N., 'Regional distribution of industry and the role of the state in Greece', Environment and Planning C, vol.8, 1990.
12. Mankiw N.G., D. Romer and D.N. Weil, 'A Contribution to the Empirics of Economic Growth', Quarterly Journal of Economics, 107, pp. 407-437, 1992.
13. Mauro L. and Podrecca E., 'The Case of Italian Regions: Convergence or Dualism?', Economic Notes, 23 (3), pp. 447-472, 1994.
14. Neven D. and Gouyette C., 'Regional Convergence in the European Community', Cahiers de Recherches Economiques, No. 9311, Working Paper, Universite de Lausanne, 1994.
15. Pagano P., 'On Productivity Convergence in the European Community Countries: 1950-1988', Giornali degli Economisti e Annali di Economia, 52 (7-9), pp. 389-401, 1993.
16. Romer P.M., 'Increasing Returns and Long-Run Growth', Journal of Political Economy, vol.94 no.5, pp.1002-10037, 1986.
17. Romer P.M., 'Capital Accumulation in the Theory of Long-Run Growth', in Barro R.J. ed., 'Modern Business Cycle Theory', Harvard University Press, 1989.
18. Solow R., 'A Contribution to the Theory of Economic Growth', Quarterly Journal of Economics, 70, pp. 65-94, 1956.