Institutional Quality, Economic Growth, and Middle-Income Trap: Evidence From Cross-Country Data

Chen Liang and Chen Li

SAGE Open, 2025, vol. 15, issue 3, 21582440251343938

Abstract: This study aims to investigate the institutional factors that contribute to helping countries successfully escape the middle-income trap, focusing on the aspect of institutional quality. The results indicate that the quality of institutions has a substantial and favorable effect on enhancing economies’ capacity to overcome the middle-income trap. In addition, the examination of institutional quality reveals that factors such as anti-corruption, government efficiency, social stability, rule of law, democracy, and market regulation all contribute positively to an economy’s capacity to overcome the middle-income trap. Therefore, to enhance the likelihood of late-developing economies overcoming the middle-income trap, governments should strengthen their reform endeavors and enhance the caliber of regional institutions.

Keywords: institutional quality; middle-income trap; economic growth (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:sae:sagope:v:15:y:2025:i:3:p:21582440251343938

DOI: 10.1177/21582440251343938

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