An Uncharted Path to Go Up from Middle Income to a Fully Developed Economy and Society
Keywords:
fragmentation, agglomeration, the 2nd unbundling, middle-income trap, technology transferAbstract
ASEAN and East Asia have been successful in applying a new development strategy for taking advantage of the 2nd unbundling for a few decades. Some countries in the region including Thailand have already reached the middle-income level and have started facing the need for transforming their industrial structure with human-capital-intensive and knowledge-based economic activities. This paper claims that the strengths of ASEAN and East Asia should be fully utilized to achieve a new development strategy in order to step up to a fully developed level of development. The key seems to be the effective utilization of positive agglomeration effects, the penetration of local firms and entrepreneurs into production networks, and the betterment of economic environment to secure the supply of human resources and soft infrastructure for human-capital-intensive and knowledge-based industries.
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