Existing studies of convergence across jurisdictions of a nation have
focused on developed economies. A key assumption underlying regional c
onvergence is geographical factor mobility, and in a developed economy
, mobility is facilitated by low transportation costs. By the same tok
en, convergence in a less-developed economy may be impeded by the abse
nce of a well-developed transportation infrastructure. We examine the
rate and industrial composition of economic convergence in a neighbori
ng less-developed country (LDC), Mexico, to examine how it might have
differed from the U.S. experience. We find evidence of stronger conver
gence in Gross State Product per capita in Mexico relative to existing
estimates of U.S. convergence. Further, while manufacturing activity
has been found to be a primary source of convergence in the U.S., we f
ind weaker evidence of convergence of manufacturing activity in Mexico
. On the other hand, industries such as hotels and transportation were
found to be significantly influential in regional convergence in the
Mexican economy.