外刊阅读20240930｜看完这篇，国庆聚会可以装一把了

+

上期划线句答案

+

本期内容

◆

双语阅读

“Middle-income countries are home to three out of every four people — and nearly two-thirds of those who struggle in extreme poverty. They are responsible for 40 per cent of the world’s total economic output — and nearly two-thirds of global carbon emissions. In short, the global effort to end extreme poverty and spread prosperity and livability will largely be won or lost in these countries.” These words by Indermit Gill, the World Bank’s chief economist, appear in the World Development Report 2024, entitled “The Middle-Income Trap”, which is the idea that economies tend to get stuck on the road to the high incomes of the US, Canada, Europe, Japan, South Korea, Australia and quite a few others.

The most populous country to have become a high-income country since 1990 is South Korea. Meanwhile, important countries have failed to converge. Brazil is an example. Once successful, Chile has also stumbled . Above all, average incomes per head of middle-income countries have stayed below 10 per cent of US levels since 1970. This record is worrying, whether or not the notion of a “trap” is statistically significant. Moreover, adds the WDR, the path that works for low-income countries will not work for more advanced ones. It notes, crucially, that the gap between GDP per worker in middle-income countries and the US is far greater than the gap in availability of physical and human capital. Thus, the principal failure of middle-income countries lies not in accumulating too little capital, but in using it so poorly.

The idea here is that the focus must shift from investment per se to infusion of new ideas available abroad, and then on to domestic innovation. What is needed, in sum, is development of a more sophisticated economy. That depends on the acquisition and development of knowhow . Infusion depends on the supply of skilled workers (engineers, scientists, managers) and openness to ideas from elsewhere (notably through direct investment and trade). For innovation, exchanges of human capital are particularly important, including via education and work abroad. The resulting diasporas are a huge potential asset. Innovation also depends on access to global markets.

The WDR argues that countries need to internalise Joseph Schumpeter’s celebrated concept of “creative destruction”, as updated by the work of Philippe Aghion and Peter Howitt. The essential step is to force incumbents to compete, encourage entrants and open the economy to those who were historically outsiders. This involves both creation and destruction. The latter tends to be accelerated by crises.