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The catch-up effect says that low-income countries can grow faster

higher income countries. However, in statistical studies covering many countries
differences, we do not observe the catch-up effect unless we control for the
other variables affecting productivity. Consider the factors that determine productivity, list and solve
I like the reasons why a poor country can't keep up with rich countries.

User Radu Coravu
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1 Answer

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13 votes

worldwide markets are already established with bis stakeholders like McD, Appe, MS, Aldi Car Manufacturers etc.

so seeing a big corporation emerging from an underdeveloped country would be kind of a suprising thing to happen.

also, economically developed countries are likely to have stable trade relationships with other countries. giving them an edge over outsiders.

Already existing infrastructure might also be a concern to keep in mind when planning your business. It's nice to have mobility, internet, electricity, water at you tap.

I guess there could even be some kind of language barrier for many countries with an insufficient educational system. that might hinder individuals to participate in the global market and community.

User Bruno Habermann
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