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Flying or Trapped?

Author

Listed:
  • Yunfang Hu
  • Takuma Kunieda
  • Kazuo Nishimura
  • Ping Wang

Abstract

We develop a unified theory with endogenous technology choice in human/knowledge capital accumulation to establish a rich array of equilibrium development paradigms, including poverty trap, middle income trap and flying geese growth. We then generalize the baseline structure and establish conditions for different development paradigms to arise. By calibrating the general model to fit the data from several representative economies with different income and growth patterns, we identify various prolonged flying geese episodes and middle income traps. By performing growth accounting, we find that improving human capital accumulation efficacy and mitigating barriers to human capital accumulation are most rewarding for advancing the economy and avoiding the middle income trap.

Suggested Citation

  • Yunfang Hu & Takuma Kunieda & Kazuo Nishimura & Ping Wang, 2020. "Flying or Trapped?," NBER Working Papers 27278, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:27278
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    • Yunfang Hu & Takuma Kunieda & Kazuo Nishimura & Ping Wang, 2023. "Flying or trapped?," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 75(2), pages 341-388, February.

    References listed on IDEAS

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    Cited by:

    1. Asano Takao & Yokoo Masanori & Shibata Akihisa, 2023. "Middle-income traps and complexity in economic development," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 27(4), pages 553-565, September.

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    More about this item

    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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