It’s Democracy, Stupid: Reappraising the Middle-Income Trap
The causes and reasons for countries’ economic growth and development have long been a challenging subject for research and debate. It is observed that while many countries experience high growth when they are low-income countries, once they become middle-income countries rapid growth is often followed by economic stagnation, with the potential for increasing social unrest as a result. A key puzzle is therefore why many middle-income countries fail to sustain suf-ficient economic growth to become high-income countries. A relatively recent concept in this debate is that of the Middle Income Trap (MIT), which argues that countries encounter a series of obstacles when trying to adapt their econo-mies and comparative advantages to become more specialized market econo-mies. In other words, the very same factors that fueled growth in the early stag-es act as a hindrance at the middle-income level, slowing down and eventually causing a stagnation of the growth process, if the correct policies are not im-plemented. This study seeks to reappraise the MIT concept by going beyond a mainstream analysis, which focuses mainly on economic aspects of growth/stagnation. Accordingly, while prudent economic management and pol-icies are vital to avoid the MIT, factors relating to governance, institutions, in-clusive growth, and education, among others, can underlie and play a determin-ing role in explaining failure or success in sustaining economic growth. There-fore, non-economic dimensions are fundamental for any reform or structural change, and, as is argued in this paper, democratic governance can serve as a useful proxy for many of these factors.
Webinar Report: ISDP-KIIP Virtual Symposium on Climate Change
On November 25-26, 2021, ISDP and the Kajima Institute of International Peace jointly organized a symposium on “Renewable Energy and Climate Cooperation: A Case for Sweden and Japan” and brought […]
Kishida in Cambodia: Seeking Regional Consensus Amid the China Threat?
Last of a two part series on Prime Minister Fumio Kishida’s travel to India and Cambodia in March 2022. This article is part of the [Asia’s Next Page] series on JAPAN […]
North Korean Women as New Economic Agents: Drivers and Consequences
Abstract This Issue Brief explores the changing social and economic role of women in North Korea since the so-called Arduous March of the 1990s. With the breakdown of the public […]
Xi Jinping and the Administrative Hierarchy and Subdivisions in China
Summary China under Xi Jinping has witnessed systemic changes with emphasis on central control, urbanization and industrialization. Policies such as the National New-Type Urbanization Plan (2014–2020) have enhanced urbanization in […]
Russia and the CIS in 2019: Relying on the Chinese Way
ABSTRACT The paper examines the relationship between Russia and the other members of the Commonwealth of Independent States, including how Moscow’s responses to changing geopolitical dynamics framed these relations in […]