The Middle-Income Trap from a Schumpeterian Perspective

19 Pages Posted: 7 Feb 2018

See all articles by Philippe Aghion

Philippe Aghion

College de France and London School of Economics and Political Science, Fellow; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Cagatay Bircan

European Bank for Reconstruction and Development

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Date Written: October 19, 2017

Abstract

In this paper we provide 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 centre of economic growth. Economic growth and development come from structural transformation, which is the interplay between changes in economic structure and supporting institutions at different stages of development. We look at the building blocks of economic development and how institutional factors affect the evolution of firm growth and competitive interaction.

Keywords: Middle-Income Trap, Schumpeterian Growth, Creative Destruction, Competition

JEL Classification: O10, O11, O30, O40

Suggested Citation

Aghion, Philippe and Bircan, Cagatay, The Middle-Income Trap from a Schumpeterian Perspective (October 19, 2017). EBRD Working Paper No. 205. Available at SSRN: https://ssrn.com/abstract=3119146 or http://dx.doi.org/10.2139/ssrn.3119146

Philippe Aghion

College de France and London School of Economics and Political Science, Fellow ( email )

London
United Kingdom

Centre for Economic Policy Research (CEPR)

London
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Cagatay Bircan (Contact Author)

European Bank for Reconstruction and Development ( email )

One Exchange Square
London, EC2A 2JN
United Kingdom
+442073388508 (Phone)
+442073386111 (Fax)

HOME PAGE: http://cagataybircan.com

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