This paper seems to rest on a distinction between "removing inefficiencies" and "transformational growth" that they do not theorize, yet should. That very few of those countries that have grown faster than the North Atlantic economies over the past two decades are on anything like Korea's trajectory is surely true. But why not? Why doesn't the removal of one inefficiency lead to a chain-reaction removal of others?:

Paul Johnson and Chris Papageorgiou: It’s too Soon for Optimism about Convergence : "The recent wave of growth in several developing economies has led to many analysts to claim that poorer countries are catching up with advanced economies. This column argues that, with the exception of a few countries in Asia which exhibited transformational growth, most of the economic achievements in developing economies have been the result of removing inefficiencies which are merely one-off level effects. While these effects are not unimportant and are necessary in the process of development, they do not imply ongoing economic growth...

...Coupled with the steady slowing of growth in the HICs, the resurgence in growth in the MICs and the non-fragile LICs has been strong enough to produce the slight decline in the dispersion of per capita GDP across countries beginning in the very late 2000s.... This finding of weak β-convergence over a very short time period that contains important high and medium-frequency influences on GDP (e.g.  the dot com bubble and its collapse and then the largest global economic slowdown since the 1930s and its immediate aftermath) leads them to claim that convergence is occurring.... An economically interesting non-convergent alternative which admits the possibility that initial conditions can influence long-run per capita income levels is that of club convergence. Club convergence occurs when the growth process has more than one stable steady state.... Many researchers, including us, have applied a wide range of empirical approaches in attempts to systematically identify convergence clubs....

If there are multiple stable steady states, then large-scale policy interventions may be required to push poor economies from one basin of attraction to another.... The recent wave of growth in many LICs and emerging markets has led to many analysts to claim, prematurely in our view, success with slogans such as “lions on the move’ (McKinsey Global Institute 2010) or like Patel et al. (2018), to assert that “there has been unconditional convergence.” However, with the exception of a few countries in Asia which exhibited transformational growth, most of the economic achievements in developing economies have been the result of removing inefficiencies which are merely one-off level effects.... Moreover, we fear that the obstacles that Patel et al. (2018) cite in their conclusion, as well as the political fragility of many LICs, may undo what progress has recently occurred and cause many LICs to languish in a low-per-capita-income steady state....

It s too soon for optimism about convergence VOX CEPR Policy Portal


#noted

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