PARADISE-LOST - GROWTH, CONVERGENCE, AND MIGRATION IN THE SOUTH-PACIFIC

This paper examines the growth experience of nine South Pacific countr ies during the period 1971-93, using the analytical framework of the S olow-Swan neoclassical growth model, panel data, and Chamberlain's II- matrix estimator. The speed of convergence of South Pacific countries to their respective steady-state levels of per capita GDP, after contr olling for the important regional effects of net international migrati on, is estimated at a relatively fast 4 percent per year. In addition, private and official transfers emanating from regional donor countrie s have kept the dispersion of real per capita national disposable inco me constant over the period, despite a significant widening in the reg ional dispersion of real per capita GDP.