Evidence on the Convergence of Per Capita Income: A Comparison of Founder Members of the Association of South East Asian Nations and the South Asian Association of Regional Cooperation. (3rd February 2013)

• Record Type: Journal Article
• Authors: Jayanthakumaran, Kankesu; Lee, Shao‐Wei
• Is Part Of: Pacific economic review. Volume 18:Number 1(2013:Feb.)
• Page Start: 108
• Page End: 121
• Publication Date: 2013-02-03
• Subjects: Pacific Area -- Economic conditions -- Periodicals; 330
• DOI: 10.1111/1468-0106.12013
• Languages: English
• ISSNs: 1361-374X

Abstract

<abstract abstract-type="main"> <title>Abstract</title> <p>This paper investigates the per capita income convergence patterns of a set of Association of South East Asian Nations (ASEAN) and South Asian Association of Regional Cooperation (SAARC) countries. We obtained a time‐series analysis for stochastic convergence by applying unit‐root tests in the presence of two endogenously‐determined structural breaks. We then supplemented the results by tests that produced evidence for <italic>β</italic> convergence. The evidence shows that the relative per capita income series of ASEAN‐5 countries were consistent with stochastic convergence and <italic>β</italic> convergence, but this was not found for SAARC‐5 countries. For the ASEAN‐5 countries, the structural breaks associated with the world oil crisis and the Asian crisis impacted heavily on the convergence/divergence process.</p> </abstract>