Tuesday, June 28, 2011

Growth and Macroeconomic Convergence in Southern Africa

This African Developement Bank Working Paper No 130 (June 2011) investigates convergence in real per capita GDP and macroeconomic policy and stability indicators within the Southern Africa Development Community (SADC). Empirical tests for the period 1992-2009 showed no evidence of absolute beta and sigma convergence in real per capita GDP among the SADC economies. Although absence of convergence does not necessarily imply lack of economic growth, further empirical assessment of possible conditional beta convergence did not reveal any tendency of convergence to own steady states. The tests indicated that Botswana and South Africa's real per capita GDP converged to a common stochastic trend while the rest were characterised by a boundless drift. Click here for the full paper.

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