Total Factor Productivity Convergence among Italian Regions: Some Evidence from Panel Unit Root Tests

Abstract

This paper employs panel unit root tests to investigate convergence in total factor productivity (TFP) among Italian regions. These tests provide an inference valid in the presence of heterogeneity and cross-sectional dependence, and when the cross-sectional dimension is smaller than the time dimension, allowing the investigation of convergence among different subsets of regions. The results add a further dimension to the conventional view on growth dynamics in the Italian peninsula depicting a lack of regional TFP convergence not only at the national level, but also at the level of geographical disaggregations where regions are conventionally thought to converge.