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Alternative Hypothesis of Cross-Country Convergence. A Non-Parametric Analysis of Manufacturing Sectors. Silvia Dal Bianco University of Oxford and University of Pavia silvia.dalbianco@eco.unipv.it. 3 Competitive Hypothesis of Convergence Absolute convergence (Barro and Sala-i-Martin 1995);
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Alternative Hypothesis of Cross-Country Convergence.A Non-Parametric Analysis of Manufacturing Sectors. Silvia Dal Bianco University of Oxford and University of Pavia silvia.dalbianco@eco.unipv.it
3 Competitive Hypothesis of Convergence • Absolute convergence (Barro and Sala-i-Martin 1995); • Conditional convergence (Barro 1991, Mankiw, Romer and Weil 1992, Dorwick and Rogers 2002); • Club Convergence (Baumol 1986, Galor and Zeira 1993, Quah 1996) • Variable of interest: log(Yijt/YUSjt) • Data.ppt • Lall Technological Taxonomy.ppt • Methodology.ppt
Distribution dynamics: Interpretation of Results Transition probabilities: 3d, medium run Graphs Scale.ppt
Distribution dynamics: Interpretation of Results ctd Transition probabilities: 2d, medium run
Distribution dynamics: Interpretation of Results ctd Ergodic Distribution: Long Run
Alternative hypothesis of convergence: testing Unimodal Ergodic: Absolute Convergence not rejected • Absolute • Conditional Steady state proxies: r, h, ddev • Club Steady state proxies plus Non-Unimodal Ergodic: Absolute Convergence rejected Unimodal Ergodic: Conditional Convergence not rejected Non-Unimodal Ergodic: Conditional Convergence rejected Unimodal Ergodic: Clubs due to K K stock Non-Unimodal Ergodic: Clubs due K rejected Unimodal Ergodic: Clubs due to Tech. TFPgap & absorption capabilities Non-Unimodal Ergodic: Clubs due to Tech. rejected
Results 3 Stylised facts: • Productivity differences smoothening (absolute conv.); • Leader overtaking (conditional conv.); • No conditional convergence Sectoral Heterogeneity • Resource Based and Low Tech: Clubs due to Technology • Medium Tech: Clubs due to both K and Technology • High Tech and Manufacturing: Absolute Convergence Synopsis of Results.ppt
Further lines of research • Convergence tendencies among developing countries; • Innovative activity of developed countries; • Manufacturing vs Services; • Within-country analysis (Dal Bianco, 2007,in progress).