Centripetal Politics and Institution Building in Exiting the Middle-Income Trap

2020 ◽  
pp. 94-116
Author(s):  
Richard Doner ◽  
Ross Schneider
Keyword(s):  
Latin America ◽  
Technical Education ◽  
Social Groups ◽  
Coalition Building ◽  
Institution Building ◽  
Middle Income ◽  
Middle Income Countries ◽  
Middle Income Trap ◽  
Education In Turkey ◽  
Quality Infrastructure

The policies and institution building needed to overcome the middle-income trap are costly, lengthy, and difficult. At the same time, major social groups in many middle-income countries are fragmented—especially in terms of business and labor—impeding and complicating coalition building. This chapter looks first at these disarticulation politics and how they affect outcomes such as low taxation, and then turns to some exceptional cases of centripetal politics and coalition building in quality infrastructure (testing and research centers) in Asia and vocational and technical education in Turkey and Latin America.

scholarly journals Global competitiveness divide and the middle-income-trap

2020 ◽  
Author(s):  
Timothy Yaw Acheampong
Keyword(s):  
High Income ◽  
World Economic Forum ◽  
Middle Income ◽  
Income Levels ◽  
Global Competitiveness ◽  
Middle Income Countries ◽  
Income Status ◽  
The World ◽  
World Economic ◽  
Middle Income Trap

In recent times, the middle-income trap (MIT) has become a pertinent issue as economists, researchers and development practitioners continue seek answers to why the majority of middle-income countries find it difficult to advance to high-income status. There is still no consensus in literature as to the exact cause(s) and the solution to the MIT. The World Economic Forum posits that, the score of countries on the Global Competitive Index (GCI) 4.0 accounts for over 80% of the variation in income levels of countries. This suggests that the extent of global competitiveness of countries could potentially help them to escape the MIT. However, some competitiveness literature have identified an apparent competitiveness divide among countries. This paper therefore seeks to answer the following questions: how does middle-income countries differ from the high-income countries in terms of global competitiveness. The study utilises an independent samples t-test and effect size measures to examine the GCI 4.0 scores of 140 countries. The study finds a very large and significant competitiveness divide between the high and middle-income countries.

scholarly journals Complexity systems and middle-income trap: the long-term roots of Latin America underdevelopment

Nova Economia ◽  
2020 ◽  
Vol 30 (spe) ◽  
pp. 1225-1256
Author(s):  
Fernanda Cimini ◽  
Jorge Britto ◽  
Leonardo Costa Ribeiro
Keyword(s):  
Economic Development ◽  
Latin America ◽  
Economic Structure ◽  
The Political ◽  
Middle Income ◽  
Middle Income Trap ◽  
To Come ◽  
Shed Light

Abstract Our intent is to reinterpret the concept of middle-income trap using the language of the complex system approach to refer to the unpredictability, non-linearity and the enormous range of possible behaviors of economic development in the long-term time series. By redefining the concept of trap in those terms, we propose to shed light on the institutional background of economic development. In order to advance our argument, we conduct a case study of Latin America, a region that has presented an unstable and non-linear economic trajectory across the 20th century. We argue that the combination between the colonial economic legacy and the political fragmentation amid the process of independence shaped the socio-economic structure and institutional capabilities for years to come, restricting the possibilities of overcoming underdevelopment.

scholarly journals GROWTH SLOWDOWNS AND MIDDLE-INCOME TRAP: EVIDENCE FROM NEW UNIT ROOT FRAMEWORK

2020 ◽  
pp. 1-17
Author(s):  
FUMITAKA FURUOKA ◽  
KIEW LING PUI ◽  
CHINYERE EZEOKE ◽  
RAY I. JACOB ◽  
OLAOLUWA S. YAYA
Keyword(s):  
Unit Root ◽  
Structural Break ◽  
Testing Procedure ◽  
Policy Implications ◽  
Unit Root Tests ◽  
Cross Sectional ◽  
Middle Income ◽  
Middle Income Countries ◽  
Middle Income Trap ◽  
High Possibility

This paper suggests a new testing procedure to systematically examine the middle-income trap (MIT). To empirically demonstrate this procedure, one high income and 14 middle-income countries are examined using newly developed unit root tests — Fourier ADF with structural break (FADF-SB) and Seemingly Unrelated Regressions Fourier ADF (SUR-FADF). The FADF-SB test incorporates unknown nonlinearity and smooth break in the time-series, while the SUR-FADF test accounts for cross-sectional dependency. The empirical findings produced mixed results: 10 countries have a relatively high possibility of facing the MIT problem, while only one country has a relatively low possibility of facing the problem. For the remaining three countries, it is uncertain whether they will face the problem of MIT. These empirical findings have significant policy implications.

scholarly journals Determinants of Foreign Direct Investment in Middle-Income Countries: New Middle-Income Trap Evidence

2017 ◽  
Vol 8 (1) ◽  
pp. 58-70 ◽  
Author(s):  
Ioannis A. Tampakoudis ◽  
Demetres N. Subeniotis ◽  
Ioannis G. Kroustalis ◽  
Manolis I. Skouloudakis
Keyword(s):  
Direct Investment ◽  
Panel Data Analysis ◽  
Trade Openness ◽  
Emerging Countries ◽  
Middle Income ◽  
Fdi Inflows ◽  
Middle Income Countries ◽  
Economic Level ◽  
Middle Income Trap ◽  
Gathering Data

Abstract The determinants of FDI have been examined extensively in the literature; however, the empirical findings are inconclusive and often diverging. Developing and emerging countries have attracted the bulk of FDI inflows since the early 2000s, subsequently improving their economic level. Nevertheless, many middle-income countries got stuck in the middle-income trap, failing to make the transition to the high-income level. The study investigates the effects of certain determinants on FDI inflows to middle-income countries, with respect to avoiding the middle-income trap. We employ a panel data analysis for fifteen middleincome countries gathering data from 1980 onwards. The results highlight the significance of trade openness, GDP and population growth on inward FDI, while financial development, inflation, infrastructure and fuel exports are found to be insignificant. Empirical findings may force governments to apply policies in certain areas, with the aim of attracting further FDI while at the same time escaping the middle-income trap.

scholarly journals Middle-Income Traps: A Conceptual and Empirical Survey

2015 ◽  
Vol 06 (03) ◽  
pp. 1550013 ◽  
Author(s):  
Fernando Gabriel Im ◽  
David Rosenblatt
Keyword(s):  
Growth Patterns ◽  
Matrix Analysis ◽  
Middle Income ◽  
Empirical Survey ◽  
Middle Income Countries ◽  
Common Parlance ◽  
Cross Country ◽  
Middle Income Trap ◽  
Historical Transition ◽  
Distribution Of Income

The term "middle-income trap" has entered common parlance in the development policy community, despite the lack of a precise definition. This paper discusses in more detail the definitional issues associated with the term. It also provides evidence on whether the growth performance of middle-income countries (MICs) has been different from other income categories, including historical transition phases in the inter-country distribution of income. A transition matrix analysis and an exploration of cross-country growth patterns provide little support for the existence of a middle-income trap.

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