Testing for convergence from the micro-level

In the growth literature, researchers are typically concerned with macro convergence. However, to the extent that macro dynamics result from the underlying microeconomic relations, convergence should also be investigated at the micro-level. In this paper, we suggest an approach that allows exploiting large micro panels to test for convergence. Compared to the traditional convergence analysis, this approach allows obtaining, at the same time, β and σ like convergence parameters for both the micro and the macro level of interest. We provide a practical example that analyzes productivity convergence in Italy across firms and provinces using a large sample of Italian firms.