Analyse On The Countermeasures That China Takes To Cross "the Middle Income Trap"

Since the reform and opening up, China’s comprehensive national strength has greatlyimproved the wealth of society in large numbers, but the uneven distribution of wealthis increasing, and the gap of income distribution is widening. This leads to insufficientdomestic demand and lack of motivation for economic growth. Our country is facedwith the serious challenges of crossing the "middleincome trap".Historical experience shows that when a country steps into middle-income countries, itneeds to cope with more serious economic, social and political challenges and theslightest mistake is likely to cause the fall or long-term stagnation of economic growth.So it is stated in this paper that it is critical for China to smoothly go over "the middleincome trap ", by drawing on the successful experience of how Japan and South Koreastep into the high income countries from the middle income ones, and the failure of howthe Latin American countries fall into the "middle income trap", by adjusting therelationship between income distribution and economic growth, by narrowing the gapbetween the rich and the poor, by increasing the income of working people, and bystimulating consumption.Based on the existing documents of how China can avoid the "middle income trap", thepaper reviews and sorts out the successful experience of how the East Asian countriesand regions skip the "middle income trap" and the lessons of how Latin Americancountries fall into the "middle income trap". The paper explores the major problems andreasons of the present income distribution, and puts forwards the possible measures onhow to regulate the national income distribution structure, thus China can smoothly getover the "the middle income trap". The full text consists of the following five parts:Chapter1introduces the origin of choosing the topic and significance of the paper, andan overview of the "middle income trap" and its major content, and also introduces thepresent research status both at home and abroad about "the middle income trap ".Meantime, the general idea and research method of this paper are outlined in thischapter.Chapter2studies on the successful experience of East Asian countries that have crossedthe "middle income trap" and on the lessons of the Latin American countries that havefallen into the "middle income trap"Chapter3analyzes the status quo of China’s income distribution and its problems, andreveals the deep reasons why the income difference is huge.Chapter4reveals the underlying factors that may cause China to fall into the "middleincome trap" and expounds the significance of China’s response to the challenges of "the middle income trap".Chapter5puts forward the countermeasures that China has to take in order to cross the"middle-income trap", mainly adjusting the income distribution patterns.