Beta Convergence Analysis Research Articles

Analisis Ketimpangan Wilayah Pantai Barat dan Pantai Timur Provinsi Sumatera Utara

Inequality between regional aspects is common in regional economic activities. This study is to measure the level of regional inequality, the relationship between economic growth, poverty, and the human development index on inequality, and analyze whether there is convergence in the West Coast Region and the East Coast Region of North Sumatra Province. The study uses Williamson index calculations to measure gaps, panel data regression analysis and sigma convergence and beta convergence analysis. The results of the research show that the West Coast Region is indicated by a low level of inequality and the East Coast Region is indicated by a high level of inequality. Economic growth has a positive but not significant impact on inequality in the West Coast Region and a positive and significant impact on inequality in the East Coast Region. Poverty has a positive and significant impact on inequality in the West Coast Region and the East Coast Region. The Human Development Index has a positive and significant impact on inequality in the West Coast Region and the East Coast Region. Simultaneously, Economic Growth, Poverty and the Human Development Index have a positive and significant impact on inequality in the West Coast Region and the East Coast Region. Sigma Convergence does not occur in the West Coast Region but occurs in the East Coast Region. Beta convergence occurs in the West Coast Region and the East Coast Region.

Unemployment Rate Convergence in the Case of Turkey: A Regional Analysis within the Scope of Dollarization and Real Wage

The unemployment rate is a fundamental variable in the socioeconomic comparison between regions. Hence, it is included in the focus of regional economic policies. Regional policy sets are frequently used to eliminate regional unemployment differences. This situation raises discussions about the efficiency of the employment policies and questions whether regional unemployment rates tend to converge to national averages. Especially in economies with regional development differences and the labor market does not exhibit a homogeneous structure, the regional analysis of unemployment rates is becoming more critical. This paper analyses the convergence of unemployment rates with the panel data set, which includes 26 regions of Turkey and the period 2004-2020. It is investigated if regional macroeconomic interactions in Turkey make the labor market homogeneous. Besides, the effects of dollarization and real wage on the unemployment rate change are questioned. The study's findings indicate the presence of deterministic and stochastic β convergence. According to the unconditional and conditional β convergence analysis, the change in the unemployment rate depends on the initial value of the unemployment rate. The findings also show that if dollarization and real wage growth increase, unemployment rate growth also increases. σ convergence analysis also confirms the presence of unemployment rate convergence.

EFFICIENCY AND INCREASING PRODUCTIVITY OF THE MANUFACTURING INDUSTRY OF EAST JAVA PROVINCE

This study aims to analyze technical efficiency and to find out the main contributors to the productivity of the manufacturing industry in East Java, which increased in 2007-2015. On the other hand, this research also aims to determine the direction of the efficiency of the manufacturing industry sub-sector and the factors that influence the level of efficiency of the manufacturing industry. The level of efficiency that approaches the frontier signifies convergence, while divergence indicates that the level of efficiency that has not approached the frontier. There are 24 manufacturing industry sectors that were observed in this study. To calculate the value of technical efficiency, this study uses Data Envelopment Analysis (DEA) with a bootstrapping approach with 2000 times the number of iterations. While the calculation of productivity changes in this study uses the Malmquist Index. Conditional beta convergence analysis (β), sigma convergence (σ), gamma convergence (γ), and stochastic convergence is used to analyze efficiency convergence. The results of the score of technical efficiency analysis show that the manufacturing industry in East Java is still in an inefficient condition with the electrical equipment industry being the highest efficiency score sector, while the furniture industry is the most inefficient sector. Technological progress at 54 percent each year is a major contributor to the increase in manufacturing industry productivity by 55 percent during 2007-2015. On the other hand, the results of testing four convergence models show different results, sigma, gamma, and stochastic convergence indicating the convergence of manufacturing industry efficiency, while conditional beta convergence testing shows an indication of the divergence in manufacturing industry efficiency. The GMM estimation results show that factors that significantly affect the efficiency of manufacturing industries are energy intensity, capital-labor ratio, capital intensity, and industrial share.
 JEL: D24, L60

Aktywność patentowa państw OECD w ujęciu regionalnym – konwergencja czy utrzymanie status quo

Celem badań prezentowanych w artykule była analiza poziomu innowacyjności państw OECD na poziomie regionalnym w latach 2000–2011. Zakres czasowy ograniczony jest ze względu na dostępność danych. W badaniach uwzględniono aktywność patentową jako miarę innowacyjności oraz nakłady na działalność B+R i zatrudnienie w sektorze B+R jako jej determinanty. Jako narzędzie badawcze wykorzystano wielowymiarową analizę statyczną i modelowanie ekonometryczne. Analizując zmiany w aktywności patentowej na poziomie poszczególnych państw (w podziale na regiony), wykorzystano analizę beta-konwergencji oraz modele przestrzenno-czasowe dla całej grupy państw. Wyniki potwierdziły, że w większości badanych państw obserwuje się pewną konwergencję aktywności, jednak jej istotność możemy potwierdzić jedynie w połowie przypadków. Obserwowana niekiedy dywergencja w żadnym z przypadków nie została potwierdzona jako istotna statystycznie. Można zatem wnioskować o ogólnej tendencji „równania w górę” w zakresie wzrostu poziomu innowacyjności w państwach OECD. Z kolei analiza ekonometryczna umożliwiła wskazanie dystansu pomiędzy aktywnością patentową poszczególnych regionów i państw. Te silniej rozwinięte, mimo zrozumiałego spowolnienia, korzystają z wykreowanego potencjału i trzymają niemal trwały dystans względem pozostałych. W ujęciu ogólnym zmiany dostrzegalne są raczej w obrębie bardziej jednorodnych (pod względem rozwoju) grup niż pomiędzy nimi.

Inequalities in Agricultural Subsidies in European Union

The paper constitutes an attempt at comparison of subsidies level in relation to utilised agricultural area, labour force and value of production throughout EU-25 member states in years 2005 – 2013. The main objective of the paper was assessment of the level of inequalities in agricultural subsidies in European Union and evaluation of their potential trends. Using FADN data aggregated at country level the Gini coefficient was calculated for mentioned dimensions of subsidies level. Additionally sigma and beta convergence analysis were carried out for subsidies and productivity levels. The general conclusion from performed analysis was that famers in EU-10N should now perceive the subsidies level throughout EU quite fair in contrast to 2005, it is especially true in case subsidies per utilised agricultural area with drop of Gini coefficient from 0.23 to 0.15, that is by 35%. On the other hand the productivity levels are converging on much slower pace than subsidies level, for both measures of productivity the beta coefficients in convergence analysis where negative but not significant at standard 5% significance level.

Agglomeration externalities and technical efficiency in Italian regions

The aim of the present work is to estimate an aggregate production function for the 20 Italian regions by emphasizing the role that agglomeration externalities (localization externalities and urbanization externalities) and spatial spillovers have in influencing the technical efficiency of the production process. To this purpose, we use the stochastic frontier approach. The results highlight the relevance and the positive impact that localization and urbanization externalities have in improving the efficiency level of the production process of Northern and Central Italy regions. Furthermore, spatial spillovers represent a source of development and growth both for Northern-Central regions and Southern regions. Finally, we show that the beta-convergence analysis of regional performance depends on the structural characteristics of each economy (Northern-Central Italy and Southern Italy), and these structural differences imply that Northern-Central and Southern macro-areas will have different steady states with regard to production performance.

Regional Convergence in the European Union, new Member States and Croatia

Abstract Over the past two decades, the issue of regional convergence in the European Union has been the subject of a wide range of empirical research. This paper aims to provide more information on the differences in regional growth patterns of new member states (NMS), as well as Croatia, in addition to the factors influencing regional disparities within each country. This research provides an analysis of regional convergence in the period 2001-2008 at the NUTS II and NUTS III level. The most widely used model for testing convergence hypotheses is beta-convergence analysis. Other factors commonly included in the econometric modelling of convergence are demographic variables, labour market conditions, industrial structure, institutional factors and overall government policy. The main hypothesis is that the process of regional convergence in NMS and Croatia is not strong enough to dominate over other factors, influencing regional potential growth (mainly industry structure and quality of human capital). Absolute β-convergence can be found at the national level for EU countries. Convergence also can be found for NMS regions, but the pace of convergence on the regional level is lower in comparison to the national level and the estimated β-convergence parameter is less significant.

Is expenditure on higher education per student converging across EU-15 countries?

This article examines the trend in expenditure per student at higher education institutions in the EU-15 countries, during the period 1998–2006. The results show that there was a tendency towards convergence (as measured by sigma and beta convergence analysis). The ratio of convergence is higher after 2001, suggesting that the implementation of European-level policies (e.g. the Bologna Declaration and the Lisbon Strategy) had an impact not only in the political arena, but also at an economic level. The convergence has been driven more by private financial resources than by public ones, supporting evidence for a gradual transformation of the patterns of financing higher education in Europe. There are elements that continue to influence the level of expenditure of individual countries; mainly their wealth as measured by GDP per capita.

Regional effects of terrorism on economic growth in Turkey: A geographically weighted regression approach

The economic growth effects of terrorism have generally been examined in a cross-country framework where socio-economic differences among the countries are ignored. This highly restrictive assumption may result in heterogeneity bias, which could be overcome by resorting to country studies rather than cross-country analysis. Moreover, the relationship between the terrorist incidents and various factors may not be stationary in space. The majority of terrorist incidents in Turkey are concentrated mainly in Eastern, and South Eastern Turkey and big cities. Thus, the geographical dispersion of terrorist incidents in Turkey may result in uneven regional impact, necessitating local parameter estimates. This study analyses the effects of terrorism on economic growth across provinces of Turkey for the time period 1987—2001. Following a traditional global regression analysis, spatial variations in the relationships are examined with geographically weighted regression (GWR) to obtain locally different parameter estimates. A GWR approach allows the modeling of relationships that vary over space by introducing distance-based weights to provide parameter estimates for each variable and each geographical location. Empirical evidence indicates that a GWR model significantly improves the model fitting over the traditional global model. Even though the traditional convergence analysis reveals that terrorism hinders economic growth, GWR results indicate that its provincial effects are more pronounced for the Eastern and South Eastern provinces compared to the Western provinces. Moreover, empirical findings suggest that there is a considerable variation in speeds of convergence of provinces, which cannot be captured by the traditional beta convergence analysis.

Konvergensi Pendapatan Per kapitq di Provinsi Kalimantan Barat dan Kalimantan Timur Tahun 2001-2007 serta Faktor - Faktor yang Mempengaruhi

This research is aimed to identify -disparity of per capita income in of the Kasaba border area (Kalimantan-Sarawak-Sabah) in West Kalimantan and East Kalimantan over the period 2001-2007. It was done by observing the coefficient variation that shows whether the sigma convergence happened or not. The other aims are to examine the determinant of beta convergence using OLS regressions with panel data. The results show that sigma convergence was not happened in West Kalimantan and East Kalimantan over the period 2001-2007. This indicated that the disparity of per capita income was happened. Beta convergence analysis indicated that absolute convergence was happened with convergence rate is 4.46 percent per year and the half-life convergence is 15.45 years. Development expenditure variable, work force participation rate and educational attainment were gave positive influence. On the other hand population growth variable was gave negative influence to the conditional convergence with convergence rate is 4.39 percent per year and the half-life convergence is 15.71 years.

Income Inequality and Economic Convergence in Turkey: A Spatial Effect Analysis

Even though the convergence of regional per capita income has been a highly debated issue internationally, empirical evidence regarding Turkey is limited as well as contradictory. This article is an attempt to investigate regional income inequality and the convergence dynamics in Turkey for the time period 1987—2001. First, the Theil coefficient of concentration index is used to analyze the dispersion aspects of the convergence process. The geographically based decomposition of inequality suggests a strong correlation between the share of interregional inequality and spatial clustering. Then, we estimate convergence dynamics employing alternative spatial econometric methods. In addition to the global models, we also estimate local models taking spatial variations into account. Empirical analysis indicates that geographically weighted regression improves model fitting with better explanatory power. There is considerable variation in speed of convergence of provinces, which cannot be captured by the traditional beta convergence analysis.

Konvergensi di Indonesia, Beberapa Temuan Awal dan Implikasinya

Recently convergence of regional per capita income has been a frequent object of regional studies as well as the case of Indonesia. However, different methods often yield different results therefore we ty to choose the appropriate methods. Rather alpha-convergence, we use theil index to analyze regional disparity and found that regional convergence in Indonesia does not appear to be a simple monotonic process, but seems to vary over time and hence requires explanation. From here, we suggest that the use of long-term interval in regression of beta-convergence analysis will destroy the relationship among variables. The use of least square methods only suitable for absolute beta-convergence analysis. We conclude that the most appropriate methods for conditional beta-convergence are instrumental methods. As an alternative one, we suggest panel-data methods.We found that the convergence rate in Indonesia is slow at 1,59 percent per year over 1975-2000. With conditional convergence analysis, we found that the difference on growth rate can be explained systematically by a set of explanatory variables. The inclusion of these variables makes the convergence rate become faster which is 3,91 percent per year. Most of this variables are under controlled by government. In summary, we conclude that government policies have significant influence for rapid and sustainable regional economic growth.