Productivity Convergence in European Manufacturing

The paper empirically investigates international productivity convergence in the manufacturing sector, which was found not converging in earlier studies. The authors analyze subsectors of aggregate manufacturing in order to compare similar technologies and to avoid the mixing of converging and nonconverging subsectors in the aggregate. Some of the subsectors converge while others, as well as aggregate manufacturing, do not. There is stronger evidence of convergence in subsectors with a smaller number of different industries. The latter serves as a proxy for the variety of technologies. Overall, the results highlight the importance of comparing similar technologies when studying productivity convergence.