Why Don't Economies Converge to a Single Economic Growth Path
by Carole E. Scott
A matter of great interest to development economists is why don't all economies converge to a single economic growth path. Why is it that, instead, some countries, decade after decade, remain mired in poverty and experience very low or negative rates of growth, while others, already wealthy, grow much more rapidly? What explains the poverty of some countries and the wealth of others? Why haven't the former been able to profit from the example set by the latter?
This paper examines the views of economist Peter Boettke, who asks whether it could be that economies diverge, rather than converge, in terms of economic growth because, rather than things like (real) capital accumulation that econometricians seek to show cause economic growth by finding that they are correlated to economic growth, the rate of economic growth is determined by history and culture. Boettke's views are discussed and compared and contrasted with others' views.
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