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Club Convergence Across Indian States: An Empirical Analysis

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  • ARFAT AHMAD SOFI

    (Rajiv Gandhi National Institute of Youth Development, India)

  • S. RAJA SETHU DURAI

    (Pondicherry University, India)

Abstract

This study evaluates the Pair-wise approach (Pesaran, 2007) and Spatial Interaction Models to examine the income convergence across 22 Indian States from 1981-82 to 2010-11. Our findings identify a small number of pairs that support income convergence; however, overall there is no evidence of club convergence in Indian states. While considering these pairs as a measure of neighborliness in spatial models, there are evidences of convergence with significant spatial interaction that provides two inferences. First, a transitional behavior of Indian states towards higher steady state is evident and second, using only geographic boundary as a measure of neighborliness can underestimate the spatial interaction in a highly technologically connected world.

Suggested Citation

  • Arfat Ahmad Sofi & S. Raja Sethu Durai, 2015. "Club Convergence Across Indian States: An Empirical Analysis," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 40(4), pages 107-124, December.
    • Handle: RePEc:jed:journl:v:40:y:2015:i:4:p:107-124
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    Cited by:

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    2. Biswajit Mohanty & N. R. Bhanumurthy, 2018. "Regional growth policy experience in India: the spatial dimension," Asia-Pacific Journal of Regional Science, Springer, vol. 2(2), pages 479-505, August.
    3. Arfat Ahmad Sofi & Subash Sasidharan & Mohammad Younus Bhat, 2023. "Economic growth and club convergence: Is there a neighbour's effect?," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(3), pages 2475-2494, July.
    4. Sulekha Hembram & Souparna Maji & Sushil Kr. Haldar, 2019. "Club Convergence among the Major Indian States During 1982–2014: Does Investment in Human Capital Matter?," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 20(2), pages 184-204, September.
    5. Hening Widi Oetomo & Marsudi Lestariningsih & Susanti, 2017. "Spatial Analysis of Newspaper Sales in East Surabaya Traffict Lights Using Moran Index," International Journal of Business and Administrative Studies, Professor Dr. Bahaudin G. Mujtaba, vol. 3(5), pages 166-174.

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    More about this item

    Keywords

    Growth; Club Convergence; Pair Wise; Spatial Interaction; India;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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