Social Sciences in China

Vol. 40, No. 3, 2019

 

A Study of an Industrialization Strategy for China’s Upper-Middle Income Stage

(Abstract)

 

Huang Qunhui, Huang Yanghua, He Jun, et al.

 

When the high-income East Asian economies entered the upper-middle income stage, their long-term growth was sustained by their real manufacturing output share and total factor productivity (TFP). This is a typical pattern that is highly consistent with classical development economics, which sees manufacturing as the engine of economic growth. When China became a middle-income country, its share of real manufacturing output and TFP both fell over the same period, exhibiting a theoretical and empirical tendency toward “premature deindustrialization” that increases the risk of being caught in the middle-income trap. Accelerating China’s development as a manufacturing power, advancing high-tech manufacturing and improving the quality and efficiency of traditional industries are realistic options for the country’s industrial development strategy.

 

Keywords: middle-income trap, premature deindustrialization, productivity, East Asian experience