Guo Weiqing: Middle Income Is A Pie &Nbsp, Or A Trap?

"Pie" or "trap"?

For the first time in the world bank's 2006 East Asian economic development report, Middle Income Trap The concept. It means that when a country climbs from a low income stage to a platform of middle income (per capita GDP of more than US $3000), it will face a dilemma. On the one hand, after the wage level has been raised, it has lost its low price. The labor The price advantage can not compete with low-income countries. On the other hand, it has not yet had enough strength to compete with rich countries in cutting-edge technology research and development. There will be a "trap effect" in the two aspects of the attack. Middle income countries will therefore face the stagnation of economic growth and may not be able to get out for a long time.

This concept is helpful for understanding and summarizing the development experience of some countries. For example, many Latin American countries suffer from long-term stagnation and social upheaval in the middle income level, which is considered a typical case of falling into the "middle-income trap". After the Asian financial turmoil, Malaysia's economic development is in a predicament. It is also regarded as a case.

But for China, the concept is complicated. First of all, the time of this concept is just the time when China reaches the level of middle income. China's GDP in 2010 was roughly 40 trillion. According to World Bank standards, China's per capita GDP was 4400 US dollars in that year, which means that China entered the ranks of middle income countries. However, due to the coincidence of time, things become a bit awkward: when China ushered in middle-income, that is, the middle income trap.

The complexity of the concept raises a question: is middle income a pie or a trap? From a sociocentric perspective, we once looked forward to the middle income pie and found that it was just the same. We have just got rid of low income worries, or more accurately, have not yet been able to get rid of the worries of low income, and then found that middle income will be a bigger worry. This is called "brow your eyebrows but your heart".

Debate and reflection

The concept of "middle-income trap" has aroused concern. development strategy The reflection of development mode and development path is the most positive aspect of it. Since 2006, this concept has entered China and accelerated in the academic and decision-making circles. At the same time, there is a wave of self reflection on China's internal development and path choice. The emergence of the concept of "middle-income trap" brings a new perspective, which adds weight to this reflection. Generally speaking, there are two aspects of reflective discussion worth noting.

First of all, the mainstream view clearly accepted the concept of "middle-income trap" and correspondingly believed that China faced the challenges brought by it. For example, Ma Xiaohe, vice president of the national development and Reform Commission's Macroeconomic Research Institute, recently wrote in the magazine "finance and economics", stressing that whether China can enter the high-income countries smoothly depends on whether it can avoid "middle-income trap". Not long ago, the Chinese Academy of Social Sciences released the report on China's industrial competitiveness (2012) NO.2. The report writer also clearly believes that China is facing the severe challenge of the "middle-income trap". In addition, in September 2011, the president of the world bank, Zoellick, said that the world bank is in communication and cooperation with the development research center of the State Council and the Ministry of finance, and will help China avoid "middle-income trap" with its own experience.

Interestingly, Ma Kai, the chief editor of the Taiwan economic daily, from the opposite side of the Straits, has a big objection to the "middle income trap". Not long ago, he wrote in the Economic Observer newspaper, sharply criticized that "as the relative advantage of cheap labor is getting weaker and needs to be taken care of all the time," the Middle Income Trap ", scholars and officials are pushing up labor costs and deteriorating operating conditions. They are just trying to kill the processing industry in order to pursue the strategy of upgrading the industrial structure, improving social distribution, and even returning to the heavy industry of the state.

Ma Kai's view is almost the only objection. However, with the criticism and opposition, the focus of the discussion has become clearer. So we see that advocates of "middle-income trap" must advocate structural spanformation, that is to say, we must change the development strategy which has relied too much on labor-intensive industries. The opposition to the "middle income trap" is intended to affirm some of the relative advantages and help them find new relative advantages, such as export processing enterprises, and continue to develop.

This involves second aspects of the discussion: what is the specific performance of the "middle-income trap" and the strategic choice to avoid pitfalls. In September 2011, Guangming Daily organized three experts to explain the "middle-income trap". Their opinions were relatively centralized and representative. Among them, Zheng Bingwen summarized the ten performances of "middle-income trap": spanformation trap, Latin America trap, welfare trap, urbanization trap, asset bubble trap, financial trap, dollar trap, population trap, kill and kill trap, and democratic trap. The ten big pitfalls are here, a bit like an ambush, and there are four ways of raising doubts. But the presentation of this package is also good: basically all the drawbacks are covered.