Sylabus
Eligibility: This is an MA-level course. BA-level students can enroll if they passed Microeconomics II and Macroeconomics II courses at IES (or their equivalent elsewhere) and if there is a free course capacity.
Primer text: Ray Debraj (1998): Development economics. Princeton University Press. (available in the library)
The text is supplemented by a packet of recent articles and book chapters. You can download them via the intranet (Moodle). It is crucial that you use Moodles (https://dl1.cuni.cz/course/view.php?id=855). It is a platform where you can find important dates, download slides, referenced papers and tasks for exercise sessions. Each of you will get access to the account of this subject. The key is “eldc”.
Requirements 1. Final exam 2. Reading research papers
I would like students to read and think about important topics in economic development. In order to get a sense of what the leading questions are and how the leading scholars structure their arguments, nothing (including my lectures) can substitute for reading original papers. Therefore, each topic contains list of suggested readings.
In addition, students are expected to read all three research papers before they are covered during the “discussion seminars” (there are two such seminars, one focusing on education and the second one focusing on microfinance). This should allow an informed follow-up discussion about the papers during the seminars.
In addition, students are required to prepare a brief written summary of one paper for each topic. The summary will contain a brief description of the motivation of the paper, the research question, why the answer is not obvious ex ante, what intervention is being studied and the main results and implications. The students should also attempt to make a critical assessment. What did you like in the article? What did you dislike or did not find convincing? Does it miss anything important? Any ideas how it can be extended/improved? Is related to some other related studies or phenomena that you read about?
These assignments have to be submitted via the Moodle course website (please no sending via email) and are due on the day before a respective “discussion seminar” at 11pm. These assignments should begin with student’s own name and title of the paper. Students will receive points for submitting each summary, and in addition, one randomly selected summary will receive points, based on their quality.
Grading
Your final grade will consist of three parts with approximately following weights:
Paper summaries: 20%
Final exam: 80%
Total: 100%
Outline of the course
(Timing of different lectures and seminars can be found on the course website on Moodle)
Lecture 1: Introduction MB
Topics
Why to study economic development?
Course: approach, structure and requirements
Historical and geographical overview
Economic lives of the poor
Literature
Ray Debraj (1998): Development Economics, ch.1-2, pp. 2-42.
Todaro and Smith (2004): Economic Development, ch. 1-2, pp.3-71. Library folder.
J. Bradford De Long, “Main Themes of Twentieth Century Economic Development,” University of California, Berkeley, pp. 1 – 10.
Banerjee, A. and E. Duflo (2006): Economic lives of the poor. Journal of Economic Perspectives
Banerjee A. and E. Duflo (2008): What is middle class about the middle classes around the world? Journal of Economic Perspectives
Lectures 2-3: Traditional growth models and poverty traps MB
Topics
Harrod-Domar model
Solow model
Convergence
Poverty traps: savings trap, capital threshold
Policy implications of poverty trap models
Literature
Ray Debraj (1998): Development Economics, ch.3, pp. 47-90.
Sachs, Jeffrey, et al. (2004): Ending Africa' s Poverty Trap, Brookings Papers on Economic Activity, Issue 1, 2004 pp. 117-130.
De Mel, McKenzey, Woodruff (2008): Returns to capital in microenterprises: evidence from a field experiment. Quarterly Journal of Economics
Lecture 4: Technology adoption and complementarities MB
Topics
Complementarities and coordination failure
Increasing returns
Literature
Ray, D. 1998: Development Economics. ch. 5, pp. 131-159.
Rosenstein-Rodan (1943): Problems of industrialization of Eastern and Southeastern Europe. The Economic Journal, Vol. 53, No. 210/211. (Jun. - Sep., 1943), pp. 202-211.
Todaro and Smith (2004): Economic Development, ch. 5, pp.170-5. Library folder.
Dulfo, Kremer and Robinson (2006): Why don't farmers use fertilizers: Evidence from field experiments in Kenya. American economic review
Seminar 1 (exercises) – growth models and complementarities (seminar slot) DR
Lecture 5-6: Population, poverty and under-nutrition MB
Topics
Population: basic concepts
Demographic transition and hidden momentum
Poverty measures and evidence
Poverty, nutrition and discrimination
Literature
Ray, D. 1998: Development Economics. ch. 8-9, pp. 249-338. Library folder.
Todaro and Smith (2004): Economic development, ch.7. Library folder.
Jensen and Miller (2008): Giffen behavior and subsistance consumption. American economic review.
Strauss, John (1986): Does better nutrition raise farm productivity? Journal of political economy.
Miguel, E. and M. Kremer. 2004. „ Worms : Identifying Impacts on Education and Health in the Presence of Treatment Externalities“. Econometrica 72: 159-217.
Field, Robles and Torero: The cognitive link between geography and development: Iodine deficiency and schooling attainment in Tanzania, working paper
Sen, A. (1992): Missing women. BMJ 1992;304: 586-7(free registration required).
Sen, A. (2002): Missing women- revisited. BMJ 2003;327:1297-1298 (6 December) (free registration required).
Miguel (2004): Poverty and witch killing. Review of economic studies.
Qian (2008): Missing women and the price of tea in China. Quarterly journal of economics.
Seminar 2 (exercises) – poverty lines, population growth DR
Lecture 7: Education MB
Topics
Benefits of greater education
Barriers of increasing education
Why are field experiments a powerful tool to figure out what policy interventions work?
Evaluations of different types of interventions: supply side and demand side
Literature
Ray, D. 1998: Development Economics. ch. 4, pp. 100-107
Psacharopoulos, George (1991): The Economic Impact of Education: Lessons for Policymakers. In Meier and Rauch (eds.) (2005), pp. 189-193.
E. Duflo, M. Kremer and R. Glennerster (2006): Using Randomization in Development Economics Research: A Toolkit. In Schultz and Strauss (2008): Handbook of Development Economics, volume 4.
E. Duflo: Schooling and Labor Market Consequences of School Construction in Indonesia: Evidence from an Unusual Policy Experiment
Glewwe, P., Ilias, N., & Kremer, M. (2010). Teacher incentives. American Economic Journal: Applied Economics, 2(3), 205–227.
Jensen, R. (2010). The (perceived) returns to education and the demand for schooling. The Quarterly Journal of Economics, 125(2), 515-548.
Barrera-Osorio, F., Bertrand, M., Linden, L. L., & Perez-Calle, F. (2011). Improving the Design of Conditional Transfer Programs : Evidence from a Randomized Education Experiment in Colombia. American Economic Journal: Applied Economics, 3(2), 167–195.
Seminar 3 (discussion seminar): Education MB
Papers to read (also pick one and write a summary before the seminar)
Banerjee and Duflo (2011). Poor economics . chapter 1 - Think again, again
Glewwe, Kremer and Moulin (2007): Many children left behind? Textbooks and test scores in Kenya.
Duflo, E. and R. Hanna (2005): Monitoring works: Getting teachers to come to school. NBER working paper 11880
Lecture 9: Microcredit and asymmetric information MB
Topics
The poor: un-bankable?
Adverse selection and credit rationing
Moral hazard and credit rationing
Microcredit innovation and its key characteristics
Measuring adverse selection and moral hazard
Literature
Armendariz DeAghion and Morduch (2005): Economics of microfinance. MIT, ch. 1-2, pp. 1-52. Library folder.
Karlan and Zinman (2007): Observing Unobservables: Identifying Information Asymmetries with a Consumer Credit Field Experiment. Econometrica.
Seminar 5 (discussion seminar): Microfinance MB
Papers to read (also pick one and write a s
Anotace
The course covers several major topics in development economics. It focuses on concepts that are important for understanding causes of under-development and poverty.
After introducing traditional growth models, particular attention is devoted to the role of technological complementarities, population growth, human capital, institutions, access to finance and psychological effects of poverty. We will also extensively discuss how the existing empirical evidence speaks to some of the key issues.
Most of the evidence will be based on field experiments.