CONVERGENCIA HACIA LA ECONOMÍA REGIONAL LÍDER EN MÉXICO: Un análisis de cointegración en panel.

The main objective of this paper is to provide empirical evidence regarding per capita income convergence of the states of the Mexican Republic towards the income of Distrito Federal, which is assumed to be the leading economy (Barro and Sala-i-Martin, 1991, 1992). We test such hypothesis by using two different panel unit root tests (Im, Pesaran and Shin, 1997; and Levin-Lin, 1993) and eight panel cointegration tests (Pedroni, 2001; Larsson, 2001). These econometric tools let us overcome the "small sample distortions" often faced by studies based on time series techniques. Our unit root tests do not show evidence of absolute convergence towards the leading economy from 1970 to 2004 and for two shorter samples. However, cointegration tests show evidence in favor of conditional convergence for the same period. Long run estimates of the speed of convergence (Mark and Sul, 2003) show that rich regions converge faster than poor ones. [ABSTRACT FROM AUTHOR]