Productivity Convergence in European Manufacturing∗

This paper empirically investigates international productivity convergence in the manufacturing sector, which was found not converging in earlier studies. We analyze subsectors of aggregate manufacturing in order to compare similar technologies and to avoid the mixing of converging and not converging subsec-tors in the aggregate. We find that some of the subsectors converge while others, as well as aggregate manufacturing, do not. Further, we find stronger evidence of convergence in those subsectors with fewer number of different industries. The latter serves as a proxy for the variety of technologies. Overall, our re-sults highlight the importance of comparing similar technologies when studying productivity convergence