Middle Income Trap: An Alternative Perspective on
Result-Based Management in the Asian Context
By
Professor M. Shamsul Haque
Department of Political Science
National University of Singapore
10 Kent Ridge, Singapore 119260
Tel:+65-6874-3982 Fax:+65-6779-6815
E-mail Address: polhaque@nus.edu.sg
Regional Forum : Journey to and From the Middle Income Status –
The Challenges for Public Sector Managers, 22-25 April, 2014
Shanghai, PRC (Shanghai National Accounting Institute)
Discussion Outline
• Introduction
• Relevance of Result-Based Management (RBM) to Middle Income Trap (MIT
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MIT – meaning, causes, remedies
RBM –origin, framework, ingredients
Use of RBM for MIT Issue (possible?)
RBM – Asian adoption: (a) overall, (b) performance/result measure
• Analysis and Critical Views: RBM for MIT (?)
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Must begin with original agenda - rethinking MIT itself
Inherent limits of RBM to deal with mega-complex puzzles
De-contextualization of performance/result principles
Understanding contexts, recognizing multiple views
• Conclusion
Introduction
• Common tendencies - critical barriers to human progress portrayed as
economic stagnation, poverty trap, unemployment trap, and low-income
trap …
• Similar economic pessimism – Middle Income Trap (MIT) – stagnant
economies (Latin America), warning signs to fast-growing economies in
Asia about ) economic impasse
• Hardly any consensus – indicator s of mid-income, number of years a
country experiences a stagnant to be an example of MIT
• Divergent explanations and recommendations with regard to the causes,
implications, and remedies of MIT
• Suggested preventive measures appear to be less specific and robust - in
the Asian context, the role of public management is very crucial in relation
to the remedies or proactive initiatives
Middle Income Trap (MIT)
• Controversies among various studies and reports about the identity of
“middle income”
• Which MICs have fallen or are likely to fall into the economic stagnation?
• Turning points of growth slowdowns – covering several decades and look for
statistically significant breaks in time series of GDP growth rates and downturns –
(Aiyal et al. 2013:8-9)
• Unlike Latin America where several mid-income economies are allegedly
already in Middle Income Trap, in Asia, middle-income countries are yet
in this Trap, but some of them are at risk of falling into long-term
economic stagnation (Tho, 2013; Egawa, 2013).
• The countries with this risk of growth slowdown include China,
Indonesia, Malaysia, Philippines, Thailand, and Vietnam.
Middle Income Trap (MIT)
• Causes behind the emergence of MIT – diverse explanations – Aiyar et al.
(2013), Kharas and Kohli (2011), Tho (2013), Chinn and Ito (2006), Egawa
(2013)
• Egawa (2013) presents a systematic explanations of the causes of MIT –
categorizing them into:
(1) Causes which trigger the MIT (excessive public investment, regional economic
disparity, and income inequality).
(2) Causes constrain countries to overcome MIT (lack of innovation, insufficient higher
education, inefficient use of the infrastructures, state monopoly of main industries,
poor governance, excessive corruption, income inequality, and failure of increase
domestic demand)
• What can public management (result-based management) do? – remaining
presentation deals with this performance/result-based public management
Performance / Result-based Public Management
Growing significance worldwide
• Language/ vocabulary of everyday government activities – now
centred on “performance”, “result”
• Proliferation of literature – books, journals, conferences, reports on
performance-related themes
Origins of result-driven public administration
• Reinvention movement/model; New Public Management (NPM);
and post-NPM models – these new models have inherent rationale
of narrow managerial performance
Operational ingredients and processes of RBM
• Generation, collection, analysis, reporting and utilisation of data
related to the inputs, outputs, outcomes, and impacts of public
organizations and programs (Thomas, 2006).
• Farzana Ahmed  result-based : planning, budgeting,
implementation, monitoring, and evaluation … … …
Performance / Result-based Public Management
Reasons for Rising Performance/Result Concern
• Administrative inefficiency, irresponsiveness
• Changing nature of public policy – towards more specific, empirical, quantifiable,
and instrumental policies
• Public demand for responsive and efficient service delivery
• Political agenda – (a) having more control over bureaucracy through performance
assessment; (b) eroded public trust in government institutions – to be revived
through performance rhetoric
But Performance/Result-based Management Remains Crucial
• To maintain public sector accountability – account for performance – vital for
democracy
• To comply with administrative codes of conduct – specific obligations as part of
performance
• To ensure organizational fairness – reward and punishment based on
performance
Performance / Result-based Public Management: NPM in Asia
 Privatization: Indonesia, Malaysia, Philippines, S’pore, Thailand, Vietnam
 Facilitating Role: Indonesia, Malaysia, Philippines, Singapore, Thailand
 Outsourcing: Malaysia, Philippines, Singapore, Thailand
 Downsizing: Indonesia, Malaysia, Laos, Philippines, Singapore, Thailand
 Agencification: Malaysia, Singapore, Thailand
 Partnership: Indonesia, Malaysia, Philippines, S’pore, Thailand, Vietnam
 Result-based Budget: Malaysia, Singapore,
 User Fee: China, Vietnam, Pakistan
 Managerial Autonomy: Singapore, Malaysia, Philippine, Thailand
 Performance Targets: Singapore, Malaysia, Thailand
Sources: Haque (2006); Polidano (1999); Atreya and Armstrong (2002)
Performance/Result-Based Management in Asian Countries
Country
Indonesia
Program
Govt Agency Performance
Accountability System (SAKIP)
Key Features
Five Year Performance Plan, Annual
Performance Agreement
Year
1999～
Japan
Policy Evaluation System
Project evaluation, performance evaluation,
comprehensive evaluation
Integrating Results-Based Budgeting system
and Personnel Performance system
Three-year Strategic Business Plans,
Medium–Term Expenditure Framework
Introduction of “Point System”; Medium–Term
Expenditure Framework
2001～
Malaysia
Integrated Results-Based
Management
Mongolia
Performance Management
System
Philippines Performance Management
System - Office Performance
Evaluation System
Singapore
Performance-informed Budgeting “Ministry Report Cards”; Focus on Outcome
System
South Korea Performance-based Budgeting
Self-Assessment of the Budgetary Program
Thailand
Results-Based Management
Source: Koike and Kabashima (2008)
key performance indicators; balanced
scorecard
1999～
2003～
2007～
2006～
1999～
2003
Analysis: Limits of Performance/Result-based Management
Limits of RBM – how far can it do?
• RBM covers many tools enabling public management –
implementation part of policy
• Policy priority, policy making involves politics – political
leaders, citizens, workers
• If policies made wrong, undesirable – their effective
implementation by RBM? Worse?
• MIT concern is too huge – requiring involvement of multiple
stakeholders, multi-dimensional issues, and multiple levels
of engagement
Analysis: Limits of Performance/Result-based Management
Questioning and re-examining of MIT itself
• It presupposes some degree of stagnation – but that is hardly the reality
• Without increasing economic growth – nations can move towards greater income
equality; greater democratization and empowerment; reduction in corruption;
greater gender and class equality; improved health and literacy
• Alternative index – happiness index, quality of life index . . .
• It is too reductionist, too economistic: UNDP Report 1996 had interesting
terms like “jobless growth”, “ruthless growth”, “voiceless growth”, “rootless
growth”, “futureless growth”
• Severe environmental cost of economic growth in the Asia-Pacific: UNDP
(2012). UNDP Asia-Pacific Human Development Report: One Planet to
Share.
Analysis: Limits of Performance/Result-based Management
Inherent limits of performance/result based management
• Dilemma in means-end relationship (input-output-outcome-impact) 
end is political/social, not managerial
• De-contextualization of performance/outcome measures (neomanagerial) – claim to universalism – one-best-way, one-size-fits all 
best practices, entrepreneurial governance, performance-based
management
• Explore the underpinnings of performance management – the
normative foundations – to deconstruct “best practices” models
• Deconstructing the universalism claims of performance/result –
examining social-normative bases of performance
Analysis: Limits of Performance/Result-based Manage
Normative Bases of Performance: East vs. West
• Western (Rational) Performance requires
• Division of labour / differentiation/ specialization
• Individualism – guided by individual self interest
• Impersonality (organization-person detachment)
• Achievement orientation – competition mentality
• Non-western Traditional Contexts
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Relative absence of differentiation/ formalistic specializatiom
Collectivism (community-, family-based) values more dominant
Impersonal-rational norms subordinated to personalism (patron-client relationship)
Ascriptive norms (heredity, family background, social status) still dominate the
politics-administration sphere)
Analysis: Limits of Performance/Result-based Manage
Within Western Context – normative bases of performance
• Traditional Bureaucratic Model: Impersonality, competence, specialization ..
• Development Administration: Decentralization, participation,
modernization; nation-building
• New Public Admin: Equity, Responsiveness, Ethics, Justice, Welfare, Public
Interest
• New Public Management: Efficiency, Economy, Effectiveness, Value for
money, Result Orientation …
Overall: There is no universal set of rules/criteria of performance or
result in public management – these are contingent upon the
context
Conclusion
• Re-examine the principles and premises of public sector
performance or result, based on a context-driven approach – in
order to make it more effective and society/people-centred.
• MIT – question its criteria, reliability, and consequence –
greater recognition to be given towards a holistic view of
development beyond economic growth – including social,
political, cultural, and ecological considerations.
THANK YOU