This paper empirically tests for convergence in consumer price indices across 17 major cities in US over the 1918–2008 period. By using the novel OLS estimator introduced by Bao, Y., Dhongde, S., 2009. Testing convergence in income distribution. Oxford Bulletin of Economics and Statistics 71,...

This paper jointly estimates the effect of inequality on growth and the impact of growth on inequality vis a simultaneous equations model. Results show that higher inequality is detrimental to growth whereas faster growth worsens the extent of income distribution.