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Journal article
Andrea Vaona

An Empirical Investigation on the Gravitation and Convergence of Industry return Rates in OECD Countries

  • Abstract
    Tests are offered for the hypotheses that sectoral average profit rates and incremental return rates are gravitating around or converging towards a common value. We study data for various OECD countries relying on an econometric method able to account for residual autocorrelation and cross-sector correlation. Our null hypotheses receive only a mixed empirical support. This is interpreted as the result of various kinds of limitations to capital mobility. Policy implications are discussed.

  • Keywords

    capital mobility, gravitation of profit rates, convergence, SURE estimation, exactly median unbiased estimator, industrial average profit rates, incremental return rates

  • JEL classification

    L16, L19, L60, L70, L80, L90, B51, B52

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