Pakistan Journal of Applied Economics

1-14

Authors: Macleans MZUMARA* and Anna CHINGARANDE*

The authors investigate the inter-sectoral comparative and competitive advantages of South Africa using Balassa technique. South Africa demonstrates significant, comparative and competitive-advantages in chemicals and the allied industries, metals and machinery/electrical sectors. There are comparative and competitive disadvantages in foot wear/head gear sector. This sector is followed by raw hides, skin, leather, and fur sectors. Most of the sectors fall in the middle ranks and there is an evidence of substantial manufacturing in South Africa. It is recommended that South Africa should work on attracting new investment, especially the foreign direct investment to improve those sectors which fall in the middle ranks. It is also recommended that South African channel resources from sectors which lack comparative and competitive advantages to sectors with such advantages, to ensure specialization where South Africa’s productive capacities are efficient.

43-52

Authors: Faiza Azhar KHAN*

The paper questions the widely held assumptions about the relationship between absolute β-convergence and σ-convergence in the existing literature which states that β-convergence is a necessary condition for σ-convergence. The study utilizes the data of 136 countries for the period 1950 to 2008. The non-linear least squares estimations of the β-convergence regression, using both the cross-section and panel data, have confirmed no absolute convergence for the world sample. The σ-convergence has been studied using its two widely used measures, namely, coefficient of variation of income and standard deviation of log income. The results reveal that there is an evidence of σ-convergence using the former measure but not using the latter measure. These findings on β and σ convergence asserts that the relationship between β and σ convergence depends on the particular measure of σ-convergence being used, and hence, cannot be generalized. Specifically, contrary to the theoretical view of relationship between β and σ convergence, there is an evidence of σ-convergence without prevalence of β-convergence among the world countries.