The aim of this paper is to test the stochastic convergence in real per capita GDP for 15 European countries using non−stationary panel data approaches over the period 1950−2003. Cross−sectional dependence is assumed due to the existence of strong linkages among European economies. However, tests derived under the assumption of cross−sectional independence are also carried out for completeness and comparison. We also split the whole sample into two sub−periods (1950−1976, 1977−2003) in order to take into account the effects of the first oil crisis (1973−1974) and to evaluate the robustness of the statistical analysis. Our results offer little support to the stochastic convergence hypothesis for the whole period, while suggest the presence of convergence in the first sub−period.

Stochastic convergence among European economies

LUPI, Claudio
2005

Abstract

The aim of this paper is to test the stochastic convergence in real per capita GDP for 15 European countries using non−stationary panel data approaches over the period 1950−2003. Cross−sectional dependence is assumed due to the existence of strong linkages among European economies. However, tests derived under the assumption of cross−sectional independence are also carried out for completeness and comparison. We also split the whole sample into two sub−periods (1950−1976, 1977−2003) in order to take into account the effects of the first oil crisis (1973−1974) and to evaluate the robustness of the statistical analysis. Our results offer little support to the stochastic convergence hypothesis for the whole period, while suggest the presence of convergence in the first sub−period.
http://www.economicsbulletin.com/2005/volume3/EB-05C30008A.pdf
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11695/8296
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