What are the fundamental research question of modern economics? The first is the question of why nations fail, as explored by James Robinson. The second is why economic growth in advanced nations has not failed as it did in the past but has instead been sustained since the Industrial Revolution. This second question has been answered by Schumpeterian economists and 2025 Nobel laureates, who identify technological innovation and “creative destruction” as the key drivers. If the problems of growth failure and sustainability have been addressed, what challenges remain? The first is rising inequality within advanced nations, and the second is the “middle-income trap” facing emerging economies that stagnate and fail to reach high-income status. This paper provides a Neo-Schumpeterian explanation for the latter—the difficulty of and solutions for economic catch-up by latecomer nations. Successful catch-up economies, such as those in South Korea and Taiwan, specialized in “short-cycle” technology sectors(e.g., IT). Short-cycle sectors, characterized by frequent creative destruction, offer lower entry barriers as the advantages of incumbents are often disrupted, while simultaneously providing high growth potential. South Korea has now moved beyond specialization in short-cycle technologies to successfully enter long-cycle industries like biotech. This demonstrates the successful completion of an “innovation-development detour” strategy: starting with short-cycle technologies and later transitioning to long-cycle ones.