Research On East Asian Countries And Regions Across The "Middle-Income Trap"

With the rapid development of economy,China successfully entered the ranks of middle-income countries in 2010.But in recent years,with the disappearance of China's demographic dividend,labor shortage,wage increase and no comparative advantage in technology capital intensive industries,China's economic growth is beginning to slow down.At the same time,due to the new normal of economic development,the contradictions of economic development are also increasingly prominent.At this critical juncture,it is a great challenge for our country to maintain sustained economic growth and successfully cross the "middle-income trap,and enter the ranks of high-income countries.From the 1960s to the early 1990s,East Asia,represented by Japan and Asia's"tigers",has maintained a sustained and high growth rate,known as the "east Asian miracle".Krugman(1994)argued that Asia's economic growth was an increase without sustained support.He took the Soviet Union as an example,arguing that constant capital and labor input was the main source of economic growth.This economic growth depends on a lot of capital and labor inputs rather than unit output.Economic growth in East Asian was not the result of total factor productivity.Krugman argued that total factor productivity is the most important indicator of the pace of output growth.However,under the "East Asia model",Japan,South Korea,Singapore,China's Taiwan,and Hong Kong have moved from low-income countries to middle-income countries through high-speed economic growth,and have been included in high-income countries.This paper examines the effect of total factor productivity on the "middle income trap" by using panel binary selection model.The results show that total factor productivity can help cross the "middle income trap".The higher the total factor productivity is,the higher the probability of crossing the "middle-income trap,is.At the same time,human capital,urbanization level and opening level all contribute to the middle income trap.And total factor productivity is the largest contribution to the probability of crossing a "middle income trap".And it plays a key role in crossing the"middle-income trap".Take Japan,Korea,Singapore and Hong Kong and China as examples,the paper analyzes their economic driving forces used Solow residual method.In the early stage,the input of capital and labor factors had played an important role in promoting the economic development.But with the development of economy,the economic development pattern of the Asian tigers and Japan has changed.The increase of total factor productivity has played an important positive role for Japan,South Korea,Singapore and Hong Kong,China,across the"middle-income trap".The results show that the total factor productivity and human capital are important economic driving forces needed to develop in the future for China.The paper uses the DEA-Malmquist index method to decompose the total factor productivity of China,Japan and Korea.The empirical results show that both technological progress and technical efficiency are important to the improvement of total factor productivity.In the end,the paper puts forward the policy suggestions to cross the "middle-income trap" on the basis of the research,including accelerating technological progress,promoting independent innovation,improving technical efficiency,increasing investment in human capital and promoting opening up to the outside world.