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The Leap of the Tiger; How Malaysia Can Escape the Middle-Income Trap

Reda Cherif and Fuad Hasanov

No 15/131, IMF Working Papers from International Monetary Fund

Abstract: Only a few European economies and Korea and Taiwan Province of China reached high-income status during 1970-2010. Malaysia’s real income per capita increased to 26 percent of the U.S. level in 2010 from 20 percent in 1970. Despite relatively strong growth and a substantial improvement in export sophistication, Malaysia’s total factor productivity lagged behind that of Korea and Taiwan Province of China. We argue that what characterizes their experience in contrast to Malaysia’s is the creation of technologies by domestic firms and a push to leapfrog to the technological frontier at an early stage of development.

Keywords: Industrial policy; Malaysia; Productivity; growth, middle-income trap, innovation, technology, electronics, it, at, technologies, Government Policy, General, Asia including Middle East, (search for similar items in EconPapers)
Pages: 27
Date: 2015-06-23
New Economics Papers: this item is included in nep-ino and nep-sea
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