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Convergence Among the U.S. States: Absolute, Conditional, or Club?, by Paul A. Johnson and Lisa N. Takeyama (Aug. 2001; Revised Oct. 2003)

This paper attempts to ascertain which of the convergence hypotheses – absolute, conditional, or club – best describes the economic development of the U.S. states since 1950. We use regression tree analysis to identify convergence clubs among the states and argue that the club characterization of the data dominates the other two. We find three convergence clubs with a state's age and it's initial densities of post offices and telephone cable determining club membership. Abstracting from catch-up effects, those states with higher densities tend to grow faster.

Working Paper (553 K, PDF)