Nonlinear Models of Convergence

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Abstract

A significant issue in studies of economic development is whether economies (countries, regions of a country, etc.) converge to one another in terms of per capita income. In this paper, nonlinear asymptotically subsiding trends of the income gap in a pair of economies model the convergence process. A few specific forms of such trends are proposed: log-exponential trend, exponential trend, and fractional trend. A pair of economies is deemed converging if time series of their income gap is stationary about any of these trends. To test for stationarity, standard unit root tests are applied with non-standard test statistics that are estimated for each kind of trends.

Original languageEnglish
Title of host publicationMathematical Optimization Theory and Operations Research - 19th International Conference, MOTOR 2020, Revised Selected Papers
EditorsYury Kochetov, Igor Bykadorov, Tatiana Gruzdeva
PublisherSpringer Science and Business Media Deutschland GmbH
Pages207-215
Number of pages9
ISBN (Print)9783030586560
DOIs
Publication statusPublished - Jul 2020
Event19th International Conference on Mathematical Optimization Theory and Operations Research,MOTOR 2020 - Novosibirsk, Russian Federation
Duration: 6 Jul 202010 Jul 2020

Publication series

NameCommunications in Computer and Information Science
Volume1275 CCIS
ISSN (Print)1865-0929
ISSN (Electronic)1865-0937

Conference

Conference19th International Conference on Mathematical Optimization Theory and Operations Research,MOTOR 2020
CountryRussian Federation
CityNovosibirsk
Period06.07.202010.07.2020

Keywords

  • Income convergence
  • Nonlinear time-series model
  • Time series econometrics
  • Unit root

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