Convergence clubs and catching up drivers in Brazilian municipalities 2000-2010

Abstract

This paper aims to analyze the process of growth convergence between 2000 and 2010 using two neoclassical models: intra-club β-convergence and inter-clubs β-catching-up. Both models estimate parameters with endogenized residue using a set of variables related to technological drivers. The intra-club β-convergence model determines the convergence clubs among municipalities. The inter-clubs β-catching-up model estimates the change in convergence probability between each club and the following upper one. The more relevant results are: (i) there is a process of convergence among municipalities in clubes; (ii) there is a process of divergence between clubs; (iii) the main variables that explain the probability of a club to catch the upper one are the technological drivers. That result means that, as long as the higher technological capability concentrates in the most advanced municipalities, the economic inequalities originated by technology gaps trend to remain.