Difference between revisions of "Middle-income trap"
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=== China may escape the middle-income trap === | === China may escape the middle-income trap === | ||
| + | *[https://www.youtube.com/watch?v=BVzPV8uDE8s How China Plans To Avoid The Middle Income Trap] | ||
*[https://www.youtube.com/watch?v=JOLceWgfbJ4 Can China Escape the Middle Income Trap?], Dr. Nicholas R. Lardy, Anthony M. Solomon Senior Fellow at the Peterson Institute for International Economics | *[https://www.youtube.com/watch?v=JOLceWgfbJ4 Can China Escape the Middle Income Trap?], Dr. Nicholas R. Lardy, Anthony M. Solomon Senior Fellow at the Peterson Institute for International Economics | ||
Revision as of 09:39, April 13, 2024
The middle-income trap refers to an economic theory where a middle-income country is failing to transform itself to a high-income economy due to its rising costs and declining competitiveness (Historically few countries successfully manage the transition from low to middle to high income).[1][2][3][4]
The Asia Society describes the middle-income trap thusly: "The “middle-income trap” is a theory of economic development in which wages in a country rise to the point that growth potential in export-driven low-skill manufacturing is exhausted before it attains the innovative capability needed to boost productivity and compete with developed countries in higher value-chain industries. Thus, there are few avenues for further growth — and wages stagnate."[5]
Slowing growth in emerging markets during the post 2007/2008 financial crisis period provided a new impetus to the “middle-income trap” debate.[6]
Contents
Asian Development Bank: The middle-income countries transition to high-income counties around the globe: Characteristics of graduation and slowdown
The abstract for the Asian Development Bank 2015 paper entitled The Middle-Income Transition around the Globe: Characteristics of Graduation and Slowdown indicates:
| “ | The paper investigates the situation of middle-income economies around the world. Since 1965, only 18 economies with a population of more than 3 million and not dependent on oil exports have made the transition to being high income. Many more have not been able to move beyond the middle-income stage. We conduct statistical tests of differences between two groups of economies across a range of growth and development variables. The results suggest that middle-income economies are particularly weak in the following areas: governance, infrastructure, savings and investment, inequality, and quality—but not quantity—of education. The findings are used to suggest whether the People’s Republic of China is successfully progressing through the middle-income stage or whether it may get caught in a middle-income trap.[7] | ” |
Criticisms of the middle-income trap theory
- The new era of unconditional convergence, Journal of Development Economics, Volume 152, September 2021, 102687
- Transitioning From Low-income Growth To High-income Growth: Is There a Middle Income Trap, Asia Development Bank, Asia Development Bank, 2017
China may escape the middle-income trap
- How China Plans To Avoid The Middle Income Trap
- Can China Escape the Middle Income Trap?, Dr. Nicholas R. Lardy, Anthony M. Solomon Senior Fellow at the Peterson Institute for International Economics
Arguments that China will not escape the middle-income trap
- China Confronts the Middle-Income Trap by Nouriel Roubini (economist), Project Syndicate, 2024
- With “Xinomics” Caught in a Trap, China Will Not Join the Ranks of Advanced Economies, September 2023, Nippon.com
External links
- Is economic growth in middle-income countries different from low-income countries? by Barry Eichengreen, Donghyun Park, and Kwanho Shin, Brookings Institute, September 25, 2017
- Re-examing the Middle Income Trap Hypothesis (MITH): What to Reject and What to Revive, National Bureau of Economic Research Working Paper by Xuehui Han and Shang-Jin Wei, Working Paper 23126, 2017[8]
Videos:
- Middle Income Trap- Explained in 2 Minutes
- What is Middle Income Trap: Who Are The Middle Income Countries
References
- ↑ Middle-Income Trap
- ↑ China May Be Running Out of Time To Escape the Middle-Income Trap, Asia Society, 2017
- ↑ Tracking the Middle-Income Trap: What is It, Who is in It, and Why? (Part 1), Asia Development Bank, 2012
- ↑ Tracking the Middle-Income Trap: What is It, Who is in It, and Why? (Part 2), Asia Development Bank, 2012
- ↑ China May Be Running Out of Time To Escape the Middle-Income Trap, Asia Society, 2017
- ↑ Is economic growth in middle-income countries different from low-income countries? by Barry Eichengreen, Donghyun Park, and Kwanho Shin, Brookings Institute, September 25, 2017
- ↑ The Middle-Income Transition around the Globe: Characteristics of Graduation and Slowdown by Paul Vandenberg, Lilibeth Poot, and Jeffrey Miyamoto. Asian Development Bank. ADBI Working Paper Series. No. 519. March 2015
- ↑ Re-examining the Middle-Income Trap Hypothesis (MITH): What to Reject and What to Revive?, Xuehui Han and Shang-Jin Wei, WORKING PAPER 23126 DOI 10.3386/w23126, ISSUE DATE February 2017
