The Middle-Income Trap from a Schumpeterian Perspective
Date
2017-09
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Description
This paper provides an outline for viewing the middle-income trap through the lens of the Schumpeterian growth paradigm, which places the notion of creative destruction at the center of economic growth.
Growth and development come from structural transformation, defined as the interplay between changes in economic structure and supporting institutions at different stages of development. The paper discusses how firms, competition, and institutions affect structural transformation.