Author(s): Nicholas Apergis, Christina Christou, Stephen Miller
Neoclassical growth theory (e.g., Solow 1956, Sw an 1956) implies that real GDP per capita should converge over time, once one incorporates differences in economic structure such as population growth rates, savings rates, depreciation rates, and so on. Researchers have pursued various avenues to alter the structure of the simp le Solow-Swan model to make the theory better approximate the data. 1 For example, Mankiw et al. (1992) introduce a role for human capital and report that the modified model pr ovides a much better fit for the data. Other authors argue that countries do converge in per capita real GDP, but only within clubs of countries with similar characteristics (Quah 1993, 1996, 1997).