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Activity Number:
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406
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Type:
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Contributed
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Date/Time:
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Thursday, August 12, 2004 : 8:30 AM to 10:20 AM
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Sponsor:
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Business and Economics Statistics Section
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| Abstract - #301856 |
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Title:
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Distributional Dynamics of Per Capita Income in Latin America: A Nonparametric Density Estimation Approach
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Author(s):
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Stephen Pollard*+ and Giorgio Canarella
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Companies:
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California State University, Los Angeles and California State University, Los Angeles
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Address:
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Simpson Tower 901, Los Angeles, CA, 90032,
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Keywords:
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Abstract:
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This paper explores the regional dynamics of per capita income among 17 Latin American countries during the period 1960-2000 using the distributional dynamics approach pioneered by Quah (1993). We find evidence of "twin-peakedness" in Latin America, with countries polarized into two groups: those relatively better off (upper-middle-income countries) and those relatively worse off (lower-middle-income countries). Thus, our results confirm the "convergence clubs" hypothesis put forward by Quah; however, unlike Quah's findings, the polarization identified in the unconditional dynamics cannot be explained by physical geography and spatial spillovers. Rather, our findings indicate that the "twin peaks" polarization of per capita income in Latin America is driven by macroeconomic factors such as trade openness, government spending, and investment. Our results indicate that Latin American countries will remain trapped in their state of underdevelopment if only market-oriented policies are followed.
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- Authors who are presenting talks have a * after their name.
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