Indicators of Real Economic Convergence. A Primer.

Whether poor economies tend to converge towards rich ones or else to diverge over time is an issue that has attracted the attention of policy-makers and academics alike for some decades. Economic convergence or divergence is a topic of considerable interest and debate, not only for validating or otherwise the two leading and competing growth models (the neoclassical and the endogenous growth approaches) but also for its policy-oriented implications. Generally speaking, the presence of convergence is considered as a valid test in favour of the neoclassical growth model as opposed to the endogenous models that predict divergence in most cases.