Abstract: China’s economic development has achieved remarkable results, yet its status as a developing country has become a focal point of international debate. Existing classification methods for developing countries, represented by per capita Gross National Income (GNI), exhibit significant limitations. The relative levels and sources of differences of GNI and Gross Domestic Product (GDP) reflect a nation’s factor competitiveness and structural characteristics, which jointly determine its economic development level. This study innovatively proposes a theoretical framework of “structural transformation of factor competitiveness,” offering a dynamic analytical paradigm for evaluating developing country status within the global division of labor. By combining transnational panel data with case studies, this paper reassesses China’s developing country status. The findings reveal: (1) Long-term net inflows of factor income driven by capital factor competitiveness serve as the core indicator for transitioning from a developing to a developed country. Despite fluctuations in China’s capital competitiveness, its total factor income remains in a persistent net outflow state, indicating an incomplete transition. (2) A negative feedback loop between foreign capital dependency and insufficient domestic capital accumulation traps developing countries in a “factor competitiveness structure trap,” hindering effective enhancement of capital competitiveness. Although China’s per capita capital stock has significantly increased, it still lags behind developed countries at comparable stages. (3) As trade scales expand, factor income shares rise in developed countries but decline in developing ones. Despite being the world’s largest goods trader, China’s factor income share remains substantially lower than that of developed economies. This study elucidates the core challenges faced by developing countries in transitioning to developed status under economic globalization, emphasizing the critical role of synergizing capital accumulation with technological innovation, reinvesting foreign capital profits, promoting industrial upgrading along the value chain, and constructing autonomous factor circulation networks to overcome developmental bottlenecks.

Key words: developing country status, factor competitiveness, mobility of factor returns, value chain division of labor, factor market division of labor