Middle-Income Trap

Abstract

Outlines the economic environment necessary to facilitate a country’s convergence to a higher-income status, with examples of countries managing the transition and countries that are failing to manage it. The middle-income trap refers to a situation whereby a middle-income country is failing to transition to a high-income economy due to rising costs and declining competitiveness. Few countries successfully manage the transition from low to middle to high income. Many economies in Latin America and the Middle East regions have been stuck in a middle-income trap, and recent evidence suggests that a number of countries in East Asia are in a similar position. Evidence to support the middle-income trap indicates a leveling-off of income per capita and a decline or stagnation in an economy’s competitiveness. Investment and innovation are the two key ingredients to moving a middle-income economy into a high-income economy, and it is necessary tounderstand the macroeconomic factors that affect investment in each middle-income economy.

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 58 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.