empirical analysis of the convergence hypothesis across countries: New evidence

The Solow growth model examines the effects of saving, population and technological advances on the growth of an economy. Long-run economic growth is explained by the exogenous variable, technology. In this model lower income countries will experience higher rates of economic growth, which will lead to convergence in the standards of living between low-income and high-income countries. Additional theories including the augmented Solow model, which tests for conditional convergence and endogenous growth theories have been developed recently. An empirical inquiry of the convergence hypothesis has been conducted using a variety samples based on income classifications and geographical locations.