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Licensed Unlicensed Requires Authentication Published by De Gruyter September 6, 2022

Middle-income traps and complexity in economic development

  • Takao Asano EMAIL logo , Akihisa Shibata and Masanori Yokoo


In this paper, we develop a simple multi-technology overlapping generations model that exhibits a wide variety of economic development patterns. In particular, our numerical simulations demonstrate that for a given set of parameter values, various types of development patterns such as the middle-income trap, the poverty trap, periodic or chaotic fluctuations, and high-income paths can coexist, and which pattern is realized depends only on the initial value of capital. For another set of parameter values, we show that, due to the pinball effect, an economy starting at a middle-income level can take off to the high-income state or get caught in the poverty trap in a seemingly random way after undergoing transient chaotic motions. Our results can explain observed complicated patterns of economic development in a unified manner.

Corresponding author: Takao Asano, Faculty of Economics, Okayama University, Tsushimanaka 3-1-1, Kita-Ku, Okayama 700-8530, Japan, E-mail:

Funding source: Kyoto University, Institute of Economic Research

Award Identifier / Grant number: 17K03806

Award Identifier / Grant number: 20H01507

Award Identifier / Grant number: 20H05631

Award Identifier / Grant number: 20K01745

Award Identifier / Grant number: 21K01388


The authors would like to thank Prof. Yoshiyasu Ono, seminar participants at Osaka University and an anonymous referee for their helpful comments. We also thank Dr. Satoko Asano for her assistance.

  1. Author contributions: All the authors have accepted responsibility for the entire content of this submitted manuscript and approved submission.

  2. Research funding: This research was financially supported by International Joint Research Center of Advanced Economic Research of KIER and the Grants-in-Aid for Scientific Research, JSPS (17K03806, 20H05631, 20K01745, 20H01507, and 21K01388).

  3. Conflict of interest statement: The authors declare no conflicts of interest regarding this article.


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Supplementary Material

The online version of this article offers supplementary material (

Received: 2021-11-19
Accepted: 2022-08-21
Published Online: 2022-09-06

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