Is regional integration a vehicle for convergence? The case of Mercosur, 1990-2014

Abstract

This article seeks to answer two questions: Has the process of regional integration in Mercosur since its launch with the Treaty of Asuncion (1991) contributed to reducing disparities in per capita income among countries in the region? Has there been convergence via intra-zone trade? To do this, it was necessary to review the theoretical framework of integration and to seek Articulo de investigacion © 2019 Universidad Catolica de Colombia. Facultad de Ciencias Economicas y Administrativas. Todos los derechos reservados 1Universitat Politecnica de Valencia, Valencia, Espana 2Universidad de La Salle, Bogota, Colombia 24 24 Finanz. polit. econ., ISSN 2248-6046, Vol. 11, N.° 1, enero-junio, 2019, pp. 23-40 explanations that would justify the Mercosur integration process under the customs union scheme and its link with convergence. Integration is understood here as an economic process influenced by the productive structures of countries, whose pattern of trade responds to the allocation of resources of the sectoral structure of production. Using the fixed effects model, it was observed that regressions do not show the existence of β-convergence in the GDP per capita of the set of countries. Additionally, a model was estimated based on the global open data index and intra-regional openness index. The results do not reveal conditional β-convergence for the set of countries. The paper concludes that Mercosur has not favored the growth of countries in terms of GDP per capita.