Income convergence among Brazilian states after the economic openness Maria Alice Moz Christofoletti Graduated student of Economics at “Luiz de Queiroz” College of Agriculture, University of Sao Paulo, Brazil Address: Avenida Padua Dias, 11 caixa postal 09 13418-900 – Piracicaba, Estado de São Paulo – Brazil Phone: 55 19 3429 4464 Fax 55 19 3422 9082 E-mail: mamchristofoletti@yahoo.com.br Humberto F. S. Spolador Professor of Economics at “Luiz de Queiroz” College of Agriculture – University of São Paulo – Brazil. Address: Avenida Padua Dias, 11 caixa postal 09 13418-900 – Piracicaba, Estado de São Paulo – Brazil Phone: 55 19 3429 4444 Fax 55 19 3434 5186 E-mail: hfsspola@esalq.usp.br . Abstract: This paper expands the analysis developed by Ellery Jr. (1994), who estimated the income convergence among Brazilian states from 1970 to 1990. The methodology is based on the convergence model proposed by Barro and Sala-i-Martin (1992) and is applied to test both the beta-convergence and the sigma-convergence. For the period after 1990, and sub-periods, (the) effects of educational level (used as a proxy for human capital), and international trade on the increase of income states were estimated. The preliminary results show that even after the economic openness in 1990s, the income convergence process has not changed compared to the first period previously analyzed (1970-1990) among the 27 Brazilian states and this process has been still ongoing (0.79% per year) to the recent years. Key Words: convergence, GDP per capita, Brazilian states. 1. Introduction Importance of sustained growth in per capita income can be represented in a simple example, as shown by Gondim and Barreto (2004): a real growth of 2% per year over a period of 20 years, increase per capita income by 50%. If this growth rate is maintained for a period of 35 years, it could double the initial per capita income. Jones (2000) shows some stylized Paper to be presented in the 50th European Regional Science Association Meeting (ERSA 2010) to be held at Jönköping, Sweden, August 19 th to 23 rd , 2010.