Middle-income (or non-convergence) traps 2017 | The World Bank | 21 August 2017 | World Bank Malaysia Office, Level 3 Sasana Kijang No. 2 Jalan Dato’ Onn

The idea of middle-income countries facing risks of falling into growth traps has been approached in at least three different ways: as a common need of policy and institutional change; as an empirical hypothesis of breaks or turning points in time-series data on levels or growth rates in per capita incomes across countries; and as a possible “bad” case among multiple equilibrium paths. While the empirical approach has led to mixed results about the existence of general properties regarding groups of countries classified as middle income, we argue in favor of the relevance of an analytical approach that takes into account the specificities of their stage of development. Bridges between general growth theories and country-specific middle-income experiences need to be built.

Mr. Otaviano Canuto
Executive Director at the Executive Board of Directors of the World Bank.