5.2.2. β Convergence Within the Top Decile

Convergence seems to occur within the top decile. Consider fractiles AI90-95, AI95-99, and AI99-100, (with all income levels expressed in constant dollars of 2003). The beginning of the time-period is 1917 for the first two, and 1913 for the third one. In the figure below, the horizontal axis is the one percent increase in the initial income level of the fractile considered, and the vertical axis is the growth rate of ytop _i, between t ₀ and (t ₀ + T):

The three scatter plots actually correspond to equation

(5.2)(1/T) . log [ytop _i,(t0+T)/ytop _i,t0] = α + β log [ytop _i,t0] + ε_it.