How to avoid middle income traps ? evidence from Malaysia
AbstractMalaysia's structural transformation from low to middle income is a success story, making it one of the most prominent manufacturing exporters'in the world. However, like many other middle income economies, it is squeezed by the competition from low-wage economies on the one hand, and more innovative advanced economies on the other. What can Malaysia do? Does Malaysia need a new growth strategy? This paper emphasizes the need for broad structural transformation; that is, moving to higher productivity production in both goods and services. This paper examines productivity growth for Malaysia at the sectoral level, and constructs several measures of the sophistication of goods and services trade, and puts these comparisons in a global context. The results indicate that Malaysia has further opportunities for growth in the services sector in particular. Modernizing the services sector may provide a way out of the middle income trap, and serve as a source of growth for Malaysia into the future.
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Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 6427.
Date of creation: 01 Apr 2013
Date of revision:
Economic Theory&Research; Banks&Banking Reform; Emerging Markets; Labor Policies; Economic Conditions and Volatility;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-05-05 (All new papers)
- NEP-DEV-2013-05-05 (Development)
- NEP-SEA-2013-05-05 (South East Asia)
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- How to avoid middle-income traps? Evidence from Malaysia
by ? in VoxEU.org on 2013-07-22 01:00:00
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