Which countries have escaped the middle-income trap?
The forces of economic convergence are powerful, but not all powerful. Poor countries tend to grow faster than rich ones, largely because imitation is easier than invention. But that does not mean that every poor country of five decades ago has caught up, as todays chart shows. It plots each countrys income per person (adjusted for purchasing power) relative to that of America, both in 1960 and in 2008.
The chart appeared in the World Bank’s recent China 2030 report. If every country had caught up, they would all be found in the top row. In fact, most countries that were middle income in 1960 remained so in 2008 (see the middle cell of the chart). Only 13 countries escaped this middle-income trap, becoming high-income economies in 2008 (top-middle). One of these success stories, it should not be forgotten, was Greece.
Photo: The Economist