Munich Personal RePEc Archive

Myths about Beta-Convergence

Gluschenko, Konstantin (2012): Myths about Beta-Convergence. Published in: Журнал Новой экономической ассоциации No. 4 (2012): pp. 26-44.

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Abstract

A popular methodology of studying spatial income inequality is analysis of beta-convergence (i.e. an inverse relationship between current income per capita and its initial level). Its widespread use is based on a belief that the economic growth theory predicts income convergence among economies (countries or regions within a country), and that beta-convergence suggests decreasing income inequality. This article demonstrates that these are nothing but myths; hence, analyzing of beta-convergence cannot serve as an adequate methodology for studying and predicting the evolution of spatial income inequality.

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