Catch-up effect
The catch-up (also: Catching-up effect ) describes the following observation: If one goes from a given starting point, so reach poor economies tend to be more rapid economic growth than richer countries.
Even very small investments in a less developed economy would, for example, lead to the first innovations with which a greatly improved production would be possible.
Basics of the catching up hypothesis
According to the neoclassical convergence hypothesis , due to different initial values of capital intensity, the per capita income of economies is converging . The followers (poorer economies) have a lower capital intensity than leaders (richer economies) and thus there is some catching-up potential for the followers. The neoclassical convergence theory is relativized by Moses Abramovitz by so-called "social capabilities", i. H. In order to be able to participate in the catching-up process, an economy must have a certain basis (legal security, human capital ...). If there are open economies, knowledge transfer , i.e. the exchange of new technologies , can strengthen the catching-up process.
Sala-i-Martin has introduced two important criteria for differentiating the convergence processes: There is a β-convergence when a less developed economy shows higher growth rates than more developed economies. Conditional β-convergence indicates that only those economies that meet certain requirements will achieve the same income level in the long term. For example, "the same equipment with human capital" or "infrastructure". The σ-convergence occurs when a group of economies, viewed over the long term, tends towards the same income level.
literature
- Tobias Frisch: Convergence and Divergence in the European Integration Process / EU Eastern Enlargement and Migration: Two Essays. Grin, Munich 2010, ISBN 978-3-640-52186-9 .
- Xavier Sala-I-Martin: Economic Growth. MIT Press, Cambridge 2004, ISBN 0-262-02553-1 .