57-85

• Kafousias, Dionysis, S.

During the last half century, one of the most challenging and disputed questions in the economics and regional economics discipline has been whether or not rich countries are getting richer or poor are getting poorer or, on the other hand, if the latter tend to catch up with their richer counterparts over time. Having set the picture, it is then the second wave of questions which are rooted to this matter. If poorer countries or regions are not capable to catch up with the richer ones, the Solowian prediction does not confirmed and the gap between poor and rich widens. Contrarily, if catch up prevails, poverty and other aspects of socioeconomic misery progressively ceased. The vast number of empirical researches within the neoclassical growth discipline conducted so far is a contradictory synthesis of both views. However, the aforementioned questions, as Durlauf, Johnson & Temple (2005) pointed out, reflect an interest in conceptualising the distribution of outcomes across countries and regions. This paper investigates the relative per capita GDP convergence hypothesis among the “poor” and “rich” prefectures of Greece during 1971-2005. By employing a time-series analysis we faced the problem of whether our modified series are stationary or they follow a random walk. Stationarity or lack thereof has been tested by the ADF, PP, DF-GLS and KPSS unit root tests. Our findings tremendously depend on each model’s inherent structure and its ability to effectively distinguish between the null and the alternative hypothesis.

• Economics and Business

• Economics

Convergence, neoclassical model, endogenous growth, NEG, steady state, stochastic convergence, unit root, ADF, DF-GLS, PP, KPSS.

JEL Classification: C21, C23, R11

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