Abstract:

Studies published in recent years indicated that middle-income countries stay for many years at the same income group, cannot ascend to upper income group. This problem that middle-income countries faced with has brought the middle-income trap concept up to the agenda. Many approaches have been developed in the literature in the light of which factors these countries should focus to avoid or exit from the trap. Therefore, the aim of this study is to contribute to explaining theoretical and empirical approaches explaining the middle income trap in detail. The phenomenon of middle income trap have been gathered to seven groups, demand side, economic development cycles, inequality, political economy, growth slowdown and other approaches. Based on the aforementioned approaches, it is concluded that the phenomenon of middle income trap is generated from a structural issue and that a comprehensive approach should be taken to overcome this problem.

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