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The Importance of Trade and Geography in the Pattern of Spatial Dependence of Growth Rates
Author(s) -
Weinhold Diana
Publication year - 2002
Publication title -
review of development economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.531
H-Index - 50
eISSN - 1467-9361
pISSN - 1363-6669
DOI - 10.1111/1467-9361.00161
Subject(s) - economics , imitation , economic geography , growth rate , endogenous growth theory , developing country , space (punctuation) , international economics , econometrics , economic growth , human capital , biology , mathematics , linguistics , philosophy , geometry , neuroscience
The paper examines the nature of spatial dependence of growth rates across countries. Economic space as well as geographic space is considered as a possible medium through which growth rates may be correlated. The results indicate that the growth rates of developing countries are influenced by the lagged growth rates of their trading partners’ growth rates. Industrialized countries’ growth rates, on the other hand, display only contemporaneous correlation with others’ growth rates that can be explained by the presence of time‐specific global shocks. The conclusions seem consistent with a general model of North–South trade with endogenous knowledge‐generated growth in the North and imitation, trade‐driven growth in the South.