Template-Type: ReDIF-Paper 1.0
Author-Name: Marco Vivarelli
Author-X-Name-First: Marco
Author-X-Name-Last: Vivarelli
Author-Email: marco.vivarelli@unicatt.it
Author-Workplace-Name: DISCE, Università Cattolica
Title: The Middle Income Trap: A Way Out Based on Technological and Structural Change 
Abstract: This paper is intended to provide an updated discussion on a series of issues that the relevant literature suggests to be crucial 
in dealing with the challenges a middle income country may encounter in its attempts to further catch-up a higher income status. 
In particular, the conventional economic wisdom – ranging from the Lewis-Kuznets model to the endogenous growth approach– will be contrasted 
with the Schumpeterian and evolutionary views pointing to the role of capabilities and knowledge, considered as  key inputs  to foster economic growth. 
Then, attention will be turned to structural change and innovation, trying to map – using the taxonomies put forward by the innovation literature 
– the concrete ways through which a middle income country can engage a technological catching-up, having in mind that developing countries are 
deeply involved into globalized markets where domestic innovation has to be complemented by the role played by international technological transfer.
Among the ways how a middle income country can foster domestic innovation and structural change in terms of sectoral diversification and 
product differentiation, a recent stream of literature underscores the potentials of local innovative entrepreneurship, that will also be 
discussed bridging entrepreneurial studies with the development literature.
Finally, the possible consequences of catching-up in terms of jobs and skills will be discussed.
Length: 40 pages
Creation-Date: 2014-09
Publication-Status: 
File-URL: http://www.unicatt.it/dipartimenti/DISES/allegati/dises1403.pdf
File-Format: Application/pdf
File-Function: First version, 2014
Number: dises1403
Classification-JEL: O14, O33
Keywords: catching-up, structural change, globalization, capabilities, innovation, entrepreneurship.
Handle: RePEc:ctc:serie2:dises1403