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Convergence in Sub-Saharan Africa: a nonstationary panel data approach

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  • Suzanne McCoskey

Abstract

Given the development of time series econometrics and nonstationary data analysis, St. Aubyn (Empirical Economics, 24, 23-44, 1999) demonstrates a new paradigm for testing income convergence, or better defined, income stability, namely testing the stationarity of pair-wise income differentials. In this paper, a panel data set of Sub-Saharan African countries is constructed and panel cointegration and unit root tests are used to investigate the convergence properties of incomes and standards of living within Africa. Overall, little evidence is found to substantiate claims of convergence across Africa, although in some cases, smaller convergence clubs within Africa may be found. In addition the use of nonstationary panel data techniques is proposed for the testing and establishing of coherent convergence clubs.

Suggested Citation

  • Suzanne McCoskey, 2002. "Convergence in Sub-Saharan Africa: a nonstationary panel data approach," Applied Economics, Taylor & Francis Journals, vol. 34(7), pages 819-829.
    • Handle: RePEc:taf:applec:v:34:y:2002:i:7:p:819-829
    DOI: 10.1080/00036840110061668
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    References listed on IDEAS

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    1. Jamie Emerson & Chihwa Kao, 2000. "Testing for Structural Change of a Time Trend Regression in Panel Data," Center for Policy Research Working Papers 15, Center for Policy Research, Maxwell School, Syracuse University.
    2. Danny Quah, 1996. "Convergence as Distribution Dynamics (with or without Growth)," CEP Discussion Papers dp0317, Centre for Economic Performance, LSE.
    3. Quah, Danny, 1996. "Convergence as distribution dynamics (with or without growth)," LSE Research Online Documents on Economics 2254, London School of Economics and Political Science, LSE Library.
    4. Steven N. Durlauf & Paul A. Johnson, 1992. "Local Versus Global Convergence Across National Economies," NBER Working Papers 3996, National Bureau of Economic Research, Inc.
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