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Title: Stuck in Transition: Nepal’s Path to Avoiding the Middle-Income Trap-Learning from Global Experience
Authors: Gautam Chiranjibi
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Gautam Chiranjibi PHD candidate, Department of economics, Hannam University Daejeon Korea
MLA 8 Chiranjibi, Gautam. "Stuck in Transition: Nepal’s Path to Avoiding the Middle-Income Trap-Learning from Global Experience." Int. j. of Social Science and Economic Research, vol. 9, no. 12, Dec. 2024, pp. 6230-6248, doi.org/10.46609/IJSSER.2024.v09i12.038. Accessed Dec. 2024. APA 6 Chiranjibi, G. (2024, December). Stuck in Transition: Nepal’s Path to Avoiding the Middle-Income Trap-Learning from Global Experience. Int. j. of Social Science and Economic Research, 9(12), 6230-6248. Retrieved from https://doi.org/10.46609/IJSSER.2024.v09i12.038 Chicago Chiranjibi, Gautam. "Stuck in Transition: Nepal’s Path to Avoiding the Middle-Income Trap-Learning from Global Experience." Int. j. of Social Science and Economic Research 9, no. 12 (December 2024), 6230-6248. Accessed December, 2024. https://doi.org/10.46609/IJSSER.2024.v09i12.038.
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ABSTRACT: There is no clear-cut explanation in economic theory that why only few developing countries transmitted to high income country but many fail to grow and stagnated in middle income for long period. However, the phenomenon Middle Income Trap cover significant explanation why countries are unable to graduate from a middle-income country to a high-income status. Nepal a land locked country having no waterways connectivity with foreign market bears thousands of challenges even upgrade to lower middle-income category. This research finds that Nepal will be stuck in lower middle-income status up to 2081 & additional 59 years to achieved high income status, if the economic growth continuously grows at the current pace. We have used time threshold methods to determine required year for Nepal to graduate to upper middle income and high-income country. We suggest Nepal to learn from the international experience how they manage to avoid middle income trap. Asian tiger South Korea and Taiwan achieved high income status initially maintaining sufficient infrastructure, education, R&D, capital intensive industrialization to enhanced total factor productivity, support for innovation intensive product and good governance. Nepal should make similar strategies additionally massive economic reforms, restructurings current decentralization, reduced unproductive government expenditure and focusing to enhanced productivity by adopting skilled and cutting-edge technology is most to escape from middle income trap & sustainable economic growth in Nepal.

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