This paper seeks to address two neglected aspects of convergence dynamics of cross-country per capita income. First, we allow evolutionary path of per capita income to contain stochastic shocks which may not converge fast enough to the long-run mean. Under this condition, we show that the...

We develop a simple optimal catch-up model under embodiment to study the potential long term dynamic relationship between total factor productivity (TFP), institutional quality, and income inequality in the context of a developing economy. Assuming a proactive role of institution in the...

We study dynamic output co-movements in Europe in a spatial setting where proportion of human capital and its appropriation pattern in production define distance among countries. Significant spatial output and shock correlations are found suggesting possible welfare-enhancing cross-country...