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Regional Convergence in Latin America
Author:
Mr. Bennett W Sutton
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Mrs. Genevieve M Lindow
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Maria Isabel Serra
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Mr. Gustavo Ramirez
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Maria Fernanda Pazmino
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Series:
IMF Working Papers
Volume/Issue:
Volume 2006: Issue 125
Language:
English
Publication Date:
01 May 2006
DOI:
https://doi.org/10.5089/9781451863857.001
ISBN:
9781451863857
ISSN:
1018-5941
Pages:
29
Keywords:
WP; GDP; country
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper presents empirical evidence on convergence of per capita output for regions within six large middle-income Latin American countries: Argentina, Brazil, Chile, Colombia, Mexico, and Peru. It explores the role played by several exogenous sectoral shocks and differences in steady states within each country. It finds that poor and rich regions within each country converged at very low rates over the past three decades. It also finds evidence of regional "convergence clubs" within Brazil and Peru- the estimated speeds of convergence for these countries more than double after controlling for different subnational levels of steady state. For the latter countries and Chile, convergence is also higher after controlling for sector-specific shocks. Finally, results show that national disparities in per capita output increased temporarily after each country pursued trade liberalization.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund
Volume 2006: Issue 125