ABSTRACT
During the early 1970s the golden age of convergence ended. While the empirical symptoms of this watershed are manifold the story is most strikingly expressed in terms of growth rates for the Western European countries and Japan. Between 1950 and 1973 the average growth rate in income per capita for twelve Western European countries – those listed in Panel A of Table 7.1 – was 3.8 percent; for Japan the corresponding growth rate was 8.0 percent. Over the next two decades, 1973-92, the average growth rate in income per capita was 1.8 percent; for Japan, 3.0 percent.
