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Convergence in a Two-Sector Nonscale Growth Model

Convergence in a Two-Sector Nonscale Growth Model Much of the convergence debate has focused solely on output. Recent empirical evidence suggests that crucial inputs, such as technology and capital, may exhibit markedly distinct convergence patterns. We examine the convergence characteristics of a two-sector nonscale model of growth that features population growth and endogenous technology. The model replicates key economic ratios and speeds of convergence with relative ease. Most important, however, is that capital and technology differ strikingly in their convergence paths and speeds. The nonconstancy of the convergence rates and the nonproportionality of the endogenous variables during transition suggests further refinements for the empirical tests of convergence. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Economic Growth Springer Journals

Convergence in a Two-Sector Nonscale Growth Model

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References (45)

Publisher
Springer Journals
Copyright
Copyright © 1999 by Kluwer Academic Publishers
Subject
Economics; Economic Growth; Macroeconomics/Monetary Economics//Financial Economics; International Economics
ISSN
1381-4338
eISSN
1573-7020
DOI
10.1023/A:1009867409614
Publisher site
See Article on Publisher Site

Abstract

Much of the convergence debate has focused solely on output. Recent empirical evidence suggests that crucial inputs, such as technology and capital, may exhibit markedly distinct convergence patterns. We examine the convergence characteristics of a two-sector nonscale model of growth that features population growth and endogenous technology. The model replicates key economic ratios and speeds of convergence with relative ease. Most important, however, is that capital and technology differ strikingly in their convergence paths and speeds. The nonconstancy of the convergence rates and the nonproportionality of the endogenous variables during transition suggests further refinements for the empirical tests of convergence.

Journal

Journal of Economic GrowthSpringer Journals

Published: Oct 14, 2004

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