Towards Sustainable Development: Revisiting  the Middle-Income Trap Hypothesis for the Southern Common Market Countries

Veli Yilanci; Uğur  Ursavaş; Tamer Güven

doi:10.35784/preko.3949

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Published: Jul 7, 2023

DOI: https://doi.org/10.35784/preko.3949

Issue Vol. 18 No. 2 (2023)

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From the Territory of Recovery to Sustainable Development: a Methodological Concept of Effective Socio-economic Development of Ukraine after the War Development
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The Impact of the War in Ukraine on the Food Security of Low-Income Countries
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86-101
The Role of Education and Innovation in Renewable Energy Consumption in OECD and BRICS Countries
Junrong Li, Abid Rehman, Jamal Khan

102-110
Towards Sustainable Development: Revisiting the Middle-Income Trap Hypothesis for the Southern Common Market Countries
Veli Yilanci, Uğur Ursavaş, Tamer Güven

111-120
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Linglin Xiang, Huaixi Zhang, Yiqing Lyu

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DOI

https://doi.org/10.35784/preko.3949

Authors

Veli Yilanci

veliyilanci@gmail.com

Çanakkale Onsekiz Mart University, Faculty of Political Sciences, Çanakkale, Turkey, Turkey

https://orcid.org/0000-0001-5738-690X

Uğur Ursavaş

ugur.ursavas@beun.edu.tr

Zonguldak Bülent Ecevit University, Faculty of Economics and Administrative Sciences, Zonguldak, Turkey, Turkey

https://orcid.org/0000-0003-1918-1457

Tamer Güven

t.guven@uu.nl

Utrecht University, Faculty of Humanities, Utrecht, Netherlands, Netherlands

https://orcid.org/0000-0003-4329-0944

Abstract

One of the Sustainable Development Goals (SDGs) of the United Nations is to promote, sustained, inclusive, and sustainable economic growth. However, it is observed that many countries struggle to move up from the middle-income to high-income level, which refers to the middle-income trap (MIT). In this paper, we test the MIT hypothesis using a novel unit root test of Gómez-Zaldívar et al. (2013) across the Southern Common Market (MECOSUR) countries. To do so, we follow a different path from the existing literature and use a novel unit root testing strategy. We first test the significance of the trend term and then examine the unit root properties of the series by allowing multiple structural breaks according to the existence/non-existence of the trend term. Our results provide evidence of stationarity for Brazil, Colombia, Ecuador, and Peru, indicating that these four MERCOSUR countries are in MIT.

Keywords:

middle-income trap, sustainable development, MERCOSUR

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Yilanci, V., Ursavaş, U. ., & Güven, T. (2023). Towards Sustainable Development: Revisiting the Middle-Income Trap Hypothesis for the Southern Common Market Countries. Problemy Ekorozwoju, 18(2), 111–120. https://doi.org/10.35784/preko.3949

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Towards Sustainable Development: Revisiting the Middle-Income Trap Hypothesis for the Southern Common Market Countries

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