Empirics of industrialisation club convergence and their drivers: Regional evidence

Industrialisation remains a fundamental driver of economic growth and development, yet the convergence patterns of industrialisation across regions have received limited empirical attention.Therefore, this study investigates club convergence in industrialisation from 2000 to 2018 using a convergence algorithm developed by Phillips and Sul.We analysed data from 183 countries, which were further divided into five regions: Sub-Saharan Africa (SSA), the Middle East and North Africa (MENA), Europe and Central Asia (ECA), East and South Asia and the Pacific (ESAP), and the Americas.Additionally, we examined potential factors contributing to the formation of convergence and divergence clubs within these regions.The results indicate a lack of panel convergence, with a negative speed of convergence across the five regions.However, the final club results obtained from the iteration procedure vary across regions.The determinants of industrialisation play both significant and insignificant roles in determining the likelihood of a country belonging to a particular convergence club within each region.This study found that, at the regional level, the convergence process in industrialisation has yet to reflect the desirable outcomes of industrial and manufacturing policies with similar characteristics.However, the narrative changes when the algorithm forms clubs for each region.