The Role of Middle Class in Economic Development: What Do Cross‐Country Data Show? |
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| Authors: | Natalie Chun Rana Hasan Muhammad Habibur Rahman Mehmet Ali Uluba?o?lu |
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| Institution: | 1. Economic Research and Regional Cooperation Department, Development Economics and Indicators Division, Asian Development Bank, Manila, The Philippines;2. Department of Economics, Deakin University, Burwood, VIC, Australia |
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| Abstract: | This paper investigates the channels through which the middle class may matter for consumption growth. Using several different middle‐class measures and a panel of 105 developing countries spanning the period 1985–2013, we find that a larger middle class influences consumption growth primarily through higher levels of human capital accumulation. There is also a significant direct effect of middle‐class size on consumption growth, which is more pronounced in the latter half of the sample, the 2000–2013 period. |
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