A Framework to Study the Role of Structural Transformation in Productivity Growth and Regional Convergence

Abstract

We show that 𝜎 -convergence in regional productivity growth can be approximated by 𝜎 -convergence in sectoral productivity growth and 𝜎 -convergence in structural transformation-led productivity growth. Applying this framework to Japanese prefecture-level data from 1874 to 2008, we find support for substantial convergence effects of structural transformation in the post-WWII years.