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ECO501 : Development Economics

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Dr Humaira Asad
Ph.D. Economics
University of Exeter, UK,

Course Contents

What is development economics?, The nature of development economics, Why study development economics?, The important role of values in development economics, What do we mean by development? Traditional economic measures, The new economic view of development, Amartya Sen’s “Capability” approach, Three core values of development, The central role of women, The three objectives of development, The millennium development goals, Common characteristics of developing countries, Defining the developing world, Basic indicators of development: real income, health, and education, Holistic measures of living levels and capabilities: The traditional human development index, The new human development index, Characteristics of the developing world: diversity within commonality, How low-income countries today differ from developed countries in their earlier stages, Are living standards of developing and developed nations converging? Case study: Divergent development: Pakistan and Bangladesh, Classical growth theory, Rostow stages of growth theory, The Harrod-Domar growth model, Structural change models, The neoclassical counterrevolution: market fundamentalism: challenging the static model, Components of economic growth, The Solow Neoclassical growth model, Distribution and development: seven critical questions, Measuring inequality, Measuring absolute poverty, Multidimensional Poverty Index, Poverty, inequality, and social welfare, Dualistic development and shifting Lorenz curves, Kuznets’s Inverted U Hypothesis, Growth, poverty and inequality, Economic characteristics of high-poverty groups, Policy options on income inequality and poverty: some basic considerations, The need for a package of policies, The basic issue: population growth and the quality of life, Population growth: past, present, and future, Structure of the world’s population, The hidden momentum of population growth, The demographic transition, The demographic transition model, The Malthusian model, The H.H theory of fertility, The demand for children in developing countries, Implications for development and fertility, The consequences of high fertility: some conflicting perspectives, Goals and objectives: toward a consensus, Some policy approaches, What developing countries can do? What the developed countries can do? How developed countries can help developing countries with their population programs Case study - population, poverty, and development: China and India, Human capital, The central roles of education and health, Education and health as joint investments for development, Improving health and education: why increasing incomes is not sufficient, Investing in education and health: the human capital approach, Child labor, Assumptions of the child labor multiple equilibria model, Other approaches to child labor policy, The gender gap: discrimination in education and health, Closing the educational gender gap is important, Health and gender, Consequences of gender bias in health and education, Educational systems and development, Definition of political economy, Determinants of the amount of schooling received by an individual, Supply side, Social versus private benefits and costs, Distribution of education, Education, inequality, and poverty, Education, internal migration, and the brain drain, Health measurement and distribution, Disease burden, HIV/AIDS, Malaria, Parasitic worms and other “neglected tropical diseases”, Health, productivity, and policy, Health systems policy, Case study, Actual growth rate (ga), Warranted equilibrium growth rate (gw), Natural growth rate (gn), The Solow neoclassical growth model, Endogenous growth theory, The Romer model, Criticisms of endogenous growth theory, The production function, The Cobb-Douglas production function, Limitations of the Cobb-Douglas production function, Schools of thought in context: South Korea and Argentina, Economic agent, Complementarity, Big push, O-Ring model, Coordination failure, Multiple equilibria: a diagrammatic approach, The big push: a graphical model, Conditions for multiple equilibria, Technological externality, Why the problem cannot be solved by a super-entrepreneur, Michael kremer’s O-Ring theory of economic development, The O-Ring model, O-Ring production function, Implications of the O-Ring theory, Economic development as self-discovery, The Hausmann-Rodrik-Velasco growth diagnostics framework, Case of El Salvador, Case of Brazil, Case of Dominican Republic, Case study: understanding a development miracle: China, The migration and urbanization dilemma, Urbanization: trends and projections, The role of cities, Industrial districts, The emergence of industrial districts or clusters in china, The urban giantism problem, First-city bias, Causes of urban giantism, The urban informal sector, Policies for the urban informal sector, Women in the informal sector, Migration and development, Toward an economic theory of rural-urban migration, Todaro migration model, Harris-Todaro model, A verbal description of the Todaro model, The Harris-Todaro migration model, Five policy implications, The imperative of agricultural progress and rural development, Agricultural growth: past progress and current challenges, Market failures and the need for government policy, The structure of agrarian systems in the developing world, Three systems of agriculture, Peasant agriculture in Latin America, Asia, and Africa, Agrarian patterns in Latin America: progress and remaining poverty challenges, Subsistence agriculture and extensive cultivation in Africa, The structure of agrarian systems in the developing world, Transforming economies: problems of fragmentation and subdivision of peasant land in Asia, The important role of women, The microeconomics of farmer behavior and agricultural development, The transition from peasant subsistence to specialized commercial farming, Subsistence farming: risk aversion, uncertainty, and survival, The economics of sharecropping and interlocking factor markets, The transition to mixed or diversified farming, From divergence to specialization: modern commercial farming, Learning about farming: the diffusion of pineapple growing in Ghana, Core requirements of a strategy of agricultural and rural development, Improving small-scale agriculture, Technology and innovation, Institutional and pricing policies: providing the necessary economic incentives, Adapting to new opportunities and new constraints, Conditions for rural development, Economics and the environment, Global warming, Climate change, Sustainable development and environmental accounting, Population, resources, and the environment, Poverty and the environment, Growth versus the environment, Rural development and the environment, Urban development and the environment, The global environment and economy, The nature and pace of greenhouse gas–induced climate change, Natural resource–based livelihoods as a pathway out of poverty: promise and limitations, The scope of domestic-origin environmental degradation: an overview, Rural development and the environment: a tale of two villages, A village in Sub-Saharan Africa, A settlement near the Amazon, Environmental deterioration in villages, Global warming and climate change: scope, mitigation, and adaptation, Scope of the problem, Mitigation, Adaptation, Economic models of environment issues, Privately owned resources, Common property resources, Public goods and bads: regional environmental degradation and the free-rider problem, Limitations of the public-good framework, Urban development and the environment, Environmental problems of urban slums, Industrialization and urban air pollution, Problems of congestion, clean water, and sanitation, Policy options in developing and developed countries, What developing countries can do, Proper resource pricing, Community involvement, Clearer property rights and resource ownership, Programs to improve the economic alternatives of the poor, Raising the economic status of women, Industrial emissions abatement policies, Proactive stance toward climate change and environmental degradation, How developed countries can help developing countries, Trade policies, Debt relief, Development assistance, What developed countries can do for the global environment, Emission controls, Research and development, Import restrictions, Case study: A world of contrasts on one island: Haiti and the Dominican republic, Geography and original environments Institutions: historical legacy, Human capital,Policy effects, International trade theory and development strategy, Economic globalization: an introduction, International trade: some key issues, Five basic questions about trade and development, Difference between inward-looking or an outward-looking trade policy, International trade: some key issues, Importance of exports to different developing nations, Types of exports, UNIDO report highlights, Demand elasticities and export earnings instability, The terms of trade and the Prebisch-Singer hypothesis, The traditional theory of international trade, Comparative advantage, Theoretical contributions: why trade take place?, Absolute advantage theory, Comparative advantage theory: by David Ricardo, Specialization, Types of comparative advantage, Relative factor endowments and international specialization: the neoclassical model, Trade theory and development: the traditional arguments, The critique of traditional free-trade theory in the context of developing-country experience, Fixed resources, full employment, and the international immobility of capital and skilled labor, Porter’s “competitive advantage” theory, Unemployment, resource under utilization, and the vent-for-surplus theory of international trade, Fixed, freely available technology and consumer sovereignty, Most new products conceived / produced in the us in 20th century, Internal factor mobility, perfect competition, and uncertainty: increasing returns, imperfect competition and issues in specialization, Some conclusions on trade theory and economic development strategy, Traditional trade strategies for development: export promotion versus import substitution, Export promotion: looking outward and seeing trade barriers, Expanding exports of manufactured goods, Import substitution: looking inward but still paying outward, Tariffs, infant industries, and the theory of protection, The IS industrialization strategy and results, Tariff structures and effective protection, Foreign-exchange rates, exchange controls, and the devaluation decision, Trade pessimist arguments, Trade optimist arguments, International finance and investment: key issues, The balance of payments account, General considerations, A hypothetical illustration: deficits and debts, The issue of payments deficits, Some initial policy issues, Trends in the balance of payments, Accumulation of debt and emergence of the debt crisis, Background and analysis, Origins of the 1980s debt crisis, Attempts at alleviation: macroeconomic instability, Classic IMF stabilization policies, and their critics, The IMF stabilization program, Tactics for debt relief, “Odious debt” and its prevention, Resolution of 1980s–1990s debt crises and continued vulnerabilities, The HIPC initiative, The global financial crisis and the developing countries, Causes of the crisis and challenges to lasting recovery, Economic impacts on developing countries, Distribution of influence among developing countries, General policy framework, Differing impacts across developing regions, Prospects for recovery and stability, Opportunities as well as dangers?, The international flow of financial resources, Private foreign direct investment and the multinational corporation, Private foreign investment: some pros and cons for development, Traditional economic arguments in support of private investment: filling savings, foreign-exchange, revenue, and management gaps, Arguments against private foreign investment: widening gaps, Reconciling the pros and cons, Private portfolio investment: benefits and risks, The role and growth of remittances, Foreign aid: the development assistance debate, Conceptual and measurement problems, Why donors give aid?, Political motivations, Economic motivations: two-gap models and other criteria, Foreign-exchange constraints, Growth and savings, Technical assistance, Absorptive capacity, Economic motivations and self-interest, Why recipient countries accept aid?, The role of nongovernmental organizations in aid, The effects of aid, The role of the financial system in economic development, Differences between developed and developing-country financial systems, The role of central banks and alternative arrangements, Functions of a full-fledged central bank, Currency boards, Alternatives to central banks, The role of development banking, Informal finance and the rise of micro finance, Traditional informal finance, Micro finance institutions, MFIs: three current policy debates, Potential limitations of micro finance as a development strategy