6533b7d3fe1ef96bd12600ed
RESEARCH PRODUCT
CONVERGENCE AND DIVERGENCE: A NEW APPROACH, NEW DATA, AND NEW RESULTS
Michele BattistiG Di VaioJoseph Zeirasubject
Economics and EconometricsEconomic Growth Divergence Convergence Global Frontier Technology Adoption0502 economics and business05 social sciencesEconomicsApplied mathematicsConvergence (relationship)050207 economicsSettore SECS-P/01 - Economia PoliticaDivergence (statistics)050205 econometricsdescription
Recently, Penn World Tables include new data that enable calculation of total factor productivity in addition to output for a large set of countries. We use these new data to examine convergence and divergence across countries by applying a new approach, which differentiates between the dynamics of output and of productivity. Our empirical results lead to two main new contributions to the literature. The first is on the interpretation of “β-convergence” in “growth regressions.” It means that output per worker in each country converges to productivity but does not imply convergence across countries, since productivity tends to diverge from the global frontier. The second contribution is to the literature, which finds that income gaps across countries are due mainly to differential technology adoption. This paper shows that the gaps in technology are not only large but keep growing over time.
| year | journal | country | edition | language |
|---|---|---|---|---|
| 2020-09-24 | Macroeconomic Dynamics |