Public and Private Investment and the Convergence of Per Capita Incomes in Developing Countries

Author/Editor:

Mohsin S. Khan ; Manmohan S. Kumar

Publication Date:

June 1, 1993

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper examines the extent to which there has been convergence in real per capita incomes across developing countries during the last two decades. In the analysis particular emphasis is placed on the separate roles played by private and public sector investment in determining both the extent and the speed of convergence. The paper also considers the importance of the stock of human capital, trade orientation, and foreign direct investment in the long-run growth process. Empirical tests are carried out for a large sample of 95 developing countries over the period 1970-90. The results provide support for the notion of differential effects of public and private investment on long-term growth, as well as for the convergence hypothesis.

Series:

Working Paper No. 1993/051

Subject:

Human capital Income Population growth Private investment Public investment spending

Notes:

Empirical tests are carried out for a large sample of 95 developing countries over the period 1970-90.

English

Publication Date:

June 1, 1993

ISBN/ISSN:

9781451847031/1018-5941

Stock No:

WPIEA0511993

Pages:

36

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