Description of Course Goals and CurriculumThe Spring version of ECO351: Economics of Development was taught by Professor Thomas Fujiwara. The course is divided into two parts. The first examines '''proximal''' causes of poverty. They are differences in capital, population growth and human capital (e.g. education) respectively. An understanding of how these factors lead to different rates of growth in counties according to the Solow model is necessary. In the second part of the semester, '''fundamental''' causes of poverty are explored. These include nutrition, education, health, credit, insurance, savings, and political constraints of development policy. Selected microeconomic issues related to the life of the poor in the developing are analyzed through both theoretical and empirical lenses.
Learning From Classroom InstructionUnlike most economics courses, however, attendance to precept is optional; it is for answering individual questions, and does not involve class-wide instruction or review of homework. Solving the Solow model graphically, and using derivatives/first order conditions will be required. Since these proofs are not shown in the lecture slides, and are written on the board, taking detailed notes in class would be recommended. Taking detailed notes in lecture is recommended—although slides are available, most of the proofs and most of the graphs are drawn on the board.
Learning For and From AssignmentsThe course has a midterm, a final, and 4 problem sets. Two textbooks are used in this course: Economics Growth by Weil, and Poor Economics by Banerjee & Duflo. The former is a traditional economics textbook, while the second is popular economics literature that makes reference to journal papers analysed in the course. In the second half of the course, the microeconomic issues of nutrition, education, health, credit, insurance, savings, and political constraints of development policy are examined. Moving from the theoretical to the applied, ten research papers and articles are studied. The most important facets of these papers are: the methodology by which the economists test their hypothesis, and the results and their implications. In particular, the course focuses on papers which use randomized controlled trials. While the exact, quantitative details of the methodology and results are not tested, it is crucial to be able to comprehend the general methods used by the experimenters, and the implications of their results. The course also challenges to learner to connect, compare, and contrast the methodologies and results of the papers. To help connect between the different papers in the second half of the course, I would recommend drawing a grid with five columns: one for fundamental causes of poverty, one for the proximal causes of poverty these causes affect, one for paper titles falling under each fundamental cause, one for descriptions of their methodologies, and one for their results and their implications on policy/aid. Questions on the problem sets also provide useful review for the midterm and final. For the textbook questions amongst them, make sure to read the relevant section of the textbook—although none of the textbook is explicitly assigned for reading, the textbook is nevertheless a helpful reference for applications of the theories taught in class. As for ''Poor Economics'', it presents a great overview of the fundamental causes of poverty covered in the second half of the course. It also summarizes, elaborates on, and connects between the conclusions reached in the different journals reviewed. Thus, in the second half of the course, previewing the text before lectures, and adding insights on the papers gained from the text to your personal summary would be recommended.
External ResourcesAsking the preceptor for elucidation on problems sets, and on material covered in lecture can also be helpful.
What Students Should Know About This Course For Purposes Of Course SelectionIn the first part of the course, the learning challenge comes in understanding the proximal causes of poverty through the Solow model. In effect, all that you need to know about the Solow model in this course have been covered by the core macroeconomics courses ECO301/ECO311. Thus it should be merely be a review. Students can learn about the causes for countries to develop at different rates in this course. Students also develop an understanding, and skepticism of the means by which NGOs and governments of developing countries have attempted to tackle poverty. More generally, the course leaves students with a healthy skepticism for making economics arguments from real world data. For example, some of the questions students would ask are: Was the data reliable? How can we observe this? Can we make causal statements? The course emphasizes that the confusion that is often made between correlation and causation in economics. Often times, there are omitted variable, reverse causality, etc. Finally, students will become more mindful of how the poor live by the end of the course—our standards of living are the exception, theirs is the norm. Students can also expect to gain a deeper understanding of the poor’s behavior, some of which may seem at first irrational to first-world citizens.
Economics of Development