Growth or Development Trap

Magdolna Csath ()
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Magdolna Csath: Pazmany Peter Catholic University, University of Public Service

Financial and Economic Review, 2022, vol. 21, issue 2, 152-174

Abstract: In this essay, we explore how to obtain a more accurate picture not only of the growth situation as measured by traditional economic indicators, but also of the level of development, which also raises the possibility of becoming trapped. We distinguish between development and growth, pointing out that Hungary has good growth figures, but lags behind in terms of development indicators. This discrepancy requires further, more detailed analysis in order to define desirable targets for development indicators that are independent of growth indicators, and to avoid the development trap by achieving them. This is also justified because, in the longer term, the evolution of development indicators also affects the chances of sustainable growth and allows for more general, systemic qualitative progress. Based on the statistical data presented in relation to the issues raised, we conclude that it would be necessary to construct a mathematical model of growth and development to illustrate and econometrically analyse the dynamic relationship. But this is not undertaken in the context of this essay.

Keywords: middle-income trap; middle development trap; resilience; adaptability; intangible investment; growth models (search for similar items in EconPapers)
JEL-codes: E22 I15 I25 J24 O11 P52 (search for similar items in EconPapers)
Date: 2022
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