STOCHASTIC CONVERGENCE OF NON-STATIONARY PANEL DATA. AN ANALYSIS FOR THE LAIA COUNTRIES

Códigos JEL: C01, C13, C52, F43

Abstract

The objective of this research article is to analyze the stochastic convergence between the economies that belong to the Latin American Integration Association (LAIA) based on the panel data framework through cointegration techniques with the properties of real income per capita considering transversal dependency of individuals, which is captured by unobservable common factors, estimates with unit roots and multiple structural breaks are also presented to avoid bias and that the results obtain good statistical inferences. In sum, the hypothesis of stochastic convergence is rejected in most of the econometric models proposed. The research methodology is quantitative with a correlational scope. It follows that the ALADI treaty, in terms of per capita income in relation to the regional average, has not led to the convergence of the economies given the integration bloc.