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Testing for Convergence Clubs in Income Per-Capita: A Predictive Density Approach

Author

Listed:
  • Canova, Fabio
Abstract
The paper proposes a technique to jointly tests for groupings of unknown size in the cross sectional dimension of a panel and estimates the parameters of each group, and applies it to identifying convergence clubs in income per-capita. The approach uses the predictive density of the data, conditional on the parameters of the model. The steady state distribution of European regional data clusters around four poles of attraction with different economic features. The distribution of income per-capita of OECD countries has two poles of attraction and each group has clearly identifiable economics characteristics. In diesem Beitrag wird eine Methode vorgestellt, mit der es möglich ist, Gruppierungen von Querschnittsdaten von zunächst unbekanntem Umfang vorzunehmen und gleichzeitig die Parameterwerte jeder Gruppe zu schätzen. Diese Methode wird genutzt, um regionale Konvergenzclubs hinsichtlich des Pro-Kopf-Einkommens zu identifizieren. Im Falle europäischer Regionaldaten zeigt sich eine Steady-state Verteilung von vier Polen mit jeweils unterschiedlicher ökonomischer Ausprägung. Die Pro-Kopf- Einkommen der OECD Länder gruppieren sich um zwei Pole, wobei jede Gruppe deutlich unterscheidbare Merkmale aufweist.

Suggested Citation

  • Canova, Fabio, 2001. "Testing for Convergence Clubs in Income Per-Capita: A Predictive Density Approach," Discussion Paper Series 26361, Hamburg Institute of International Economics.
    • Handle: RePEc:ags:hwwadp:26361
    DOI: 10.22004/ag.econ.26361
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    References listed on IDEAS

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    More about this item

    Keywords

    International Development;

    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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