Old wine and new bottles: A critical appraisal of the middle-income trap in BRICS countries.

Hartwell, C. A., 2018. Old wine and new bottles: A critical appraisal of the middle-income trap in BRICS countries. Russian Journal of Economics, 4 (2), 133 - 154.

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DOI: 10.3897/j.ruje.4.27726

Abstract

The idea of a middle-income trap is now over a decade old and continues to be applied to growth paths which have not been self-sustaining. With the bulk of emerging markets now approaching middle-income status, and given the reality of slower growth for many countries (and the policy recommendations that currently exist for overcoming this problem), is the middle-income trap still a relevant framework? Using reference to the BRICS countries, the key finding of this analysis is that the middle-income trap conceptualization is of little value-added, as fundamentals still matter, especially in relation to macroeconomic stability. Similarly, we note that “quality” institutions are necessary, both political and economic, including (smaller) size of government and property rights. The “trap” as currently formulated is thus nothing new or particularly relevant, as it repackages some familiar structural issues while avoiding other crucial ones.

Item Type:Article
ISSN:2405-4739
Uncontrolled Keywords:middle income trap ; growth ; BRICS ; institutions ; total factor productivity
Group:Faculty of Management
ID Code:31394
Deposited By: Unnamed user with email symplectic@symplectic
Deposited On:26 Oct 2018 13:45
Last Modified:26 Oct 2018 13:45

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