Are G7 per capita real GDP levels non-stationary, 1870–2001?
journal contribution
posted on 2007-08-01, 00:00authored byParesh Narayan
In this paper we examine whether or not G7 per capita income can be classified as a stationary process using data for over a century. The unit root null hypothesis is tested using the recently developed Lagrange multiplier test which allows for at most two structural breaks. We are able to reject the unit root null hypothesis for all the countries at the 5 percent level or better, except for Italy and Germany.