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Institutional Quality, Economic Growth, and Middle-Income Trap: Evidence From Cross-Country Data

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  • Chen Liang
  • Chen Li

Abstract

This study aims to investigate the institutional factors that contribute to helping countries successfully escape the middle-income trap, focusing on the aspect of institutional quality. The results indicate that the quality of institutions has a substantial and favorable effect on enhancing economies’ capacity to overcome the middle-income trap. In addition, the examination of institutional quality reveals that factors such as anti-corruption, government efficiency, social stability, rule of law, democracy, and market regulation all contribute positively to an economy’s capacity to overcome the middle-income trap. Therefore, to enhance the likelihood of late-developing economies overcoming the middle-income trap, governments should strengthen their reform endeavors and enhance the caliber of regional institutions.

Suggested Citation

  • Chen Liang & Chen Li, 2025. "Institutional Quality, Economic Growth, and Middle-Income Trap: Evidence From Cross-Country Data," SAGE Open, , vol. 15(3), pages 21582440251, July.
  • Handle: RePEc:sae:sagope:v:15:y:2025:i:3:p:21582440251343938
    DOI: 10.1177/21582440251343938
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