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The Review of Economics and Statistics Vol. 88 No. 4 2006

Growth and Convergence across the United States: Evidence from County-Level Data

Matthew J. Higgins1,2; Daniel Levy; Andrew T. Young3,4

1 Georgia Institute of Technology · 2 University of Utah · 3 Texas Tech University · 4 University of Mississippi

open access

Abstract

We use U.S. county data (3,058 observations) and 41 conditioning variables to study growth and convergence. Using ordinary least squares (OLS) and three-stage least squares with instrumental variables (3SLS-IV), we report on the full sample and metro, nonmetro, and and regional samples: (1) OLS yields convergence rates around 2%; 3SLS yields 6%–8%; (2) convergence rates vary (for example, the Southern rate is 2.5 times the Northeastern rate); (3) federal, state, and local government negatively correlates with growth; (4) the relationship between educational attainment and growth is nonlinear; and (5) the finance, insurance, and real estate industry and the entertainment industry correlate positively with growth, whereas education employment correlates negatively.

DOI
10.1162/rest.88.4.671
Volume
88
Issue
4
Pages
671-681
Language
en
Sources
openalex crossref

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