This paper investigates whether the forty-eight contiguous U.S. states converge and, if so, whether convergence is absolute. Economies are shown to converge if, and only if, technology is stationary around a common trend. If convergence does occur, it is unlikely to be absolute unless the economy fixed effects in technology, capital's share, and the rental rate vanish. Examining data on the level of technology, capital's share, and the rental rate provides strong evidence that the continuous U.S. states converge rapidly to levels that are far apart. The rapidity of convergence suggests that factors and technology are highly mobile across the contiguous U.S. states. Copyright 1996 by MIT Press.

Using panel data for the forty-eight contiguous U.S. states in each year between 1970 and 1986, this paper investigates the extent to which government capital and current government services contribute to private production. The paper finds fairly strong evidence that current government educational services are productive but no evidence that the other government activities considered are productive. Indeed, government capital often has statistically significant negative productivity. The results are robust across the many specifications considered. Copyright 1994 by MIT Press.

Stephen G. Cecchetti, Georgios Karras, Sources of Output Fluctuations During the Interwar Period: Further Evidence on the Causes of the Great Depression, The Review of Economics and Statistics, Vol. 76, No. 1 (Feb., 1994), pp. 80-102