Explanation
Absolute convergence refers to the hypothesis that:
- Poorer countries will grow faster than richer countries
- Eventually, all countries will converge to the same level of per capita output
- This occurs regardless of differences in savings rates, population growth, or other factors
Why not the other options:
- Club convergence: Countries converge only within specific "clubs" or groups with similar characteristics
- Conditional convergence: Countries converge to their own steady states, which depend on factors like savings rates and population growth
Key insight: Absolute convergence implies that developing countries will completely catch up to developed countries in per capita output, assuming all else is equal.