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DEVELOPMENT ECONOMICS

Program

EN IT

Updated A.Y. 2018-2019

• MODULE Convenor   Prof. Alessandra Pelloni  alessandrapelloni@hotmail.com  Office hours: to be agreed by email.   Alessandra Pelloni is Professor of Economics at the University of Rome ‘Tor Vergata’ and   Senior Research Fellow  at the Rimini Center for Economic Analysis.  She studied in Modena, LSE, EUI,  and worked in Warwick and Manchester Universities for six years  Her main research interests are in the economics of growth and development and in optimal taxation. Her main publications and further details are available on www.alessandrapelloni.it

Program
• Focus Why are some countries poor while others are rich? What explains the success stories of economic development, and how can we learn from the failures? How do we make sense of the enormous inequalities that we see, both within and across countries ? What is the difference between development and growth? These, among others, are the “big questions” of economic development.

• Objectives . By the end of the course, students will have acquired an understanding of the main issues  in development economics. Subjects as theories of economic growth, economic inequality and poverty, population growth and demographic issues, human capital accumulation, trade policy, the role of finance and international aid will be treated. Students will be exercised through intensive discussion of  topics and the critical appraisal of current research.

• For the course we will  make use of the following textbooks:  Michael Todaro and Stephen Smith, Economic Development.  Pearson, 2015 and Gerard Roland Development Economics Routledge 2016 An extensive set of readings  will be made available  during the course. 
• A popular book on development economics is Abhijit Banerjee and Esther Duflo,  Poor Economics Public Affairs 2011 You do not have to purchase it, but it is great read.

Syllabus:

First Part:

1 Introducing Economic Development: A Global Perspective

• The Meaning and Measurement of Economic Development.
• Standard and Alternative Approaches to Development.

2  Economic Growth: Theory and Empirics
•  Development as Growth:
• Neoclassical Growth Theory
• Endogenous Growth Theory
• Rostow’s Stages of Growth
• The Harrod-Domar Growth Model
• The Lewis Model

3 The Role of Initial Conditions

•  Coordination Failures and  Multiple Equilibria
•  The Big Push Model
• The O-Ring Model

4  Poverty
• Measurement Issues
• Randomized Trials in the Fight against Poverty
• Growth and Poverty

• 5 Inequality

• Measurement Issues
• What’s Wrong  about Inequality?
• Kuznets’s Hypothesis
• Growth and Inequality

6  Population and Economic Development

• World Population Growth throughout History
• The Demographic Transition
•  The  Malthusian  Model
• High Fertility: the Debate

7  Human Capital

•  Education and Health
•  Child Labor
• The Gender Gap in Education and Health
• Educational and Health Systems: Social versus Private Benefits 

8  Trade and  Globalization

• Relative Factor Endowments and International Specialization: The Neoclassical Model
• Trade and Resource Growth: North-South Models of Unequal Trade
• Trade and New Growth Theory

9 Finance and Development

• Limits of credit markets
• Informal credit
• Microfinance

10  The Environment and Development

• Environmental Accounting
• Environment Relationships to Population, Poverty, and Economic Growth
• Economic Models of Environmental Issues

11 Foreign Aid

• Is Aid good for growth?,
• Why Donors Give Aid
• Different Kinds of Aid


Grades: In the two hour final examination there will be a mix of short answers (including multiple choice), and essay answers based on chapters 1-6 and 8 of Todaro-Smith . If less than five students register for a session the examination will be oral ( with similar kinds of questions).. For attending students oral presentations of research projects, prepared under the supervision of the module convenor will substitute the final examination.