LEO Poverty and Development

More trade?

The forecast growth for developing countries has been reduced and countries such as Lesotho will be hard hit due to dependence on foreign trade


The goal of the course is to enhance understanding of poverty and development economics. The course runs from 28 August to 4 December 2012. There is a week-long break for Thanksgiving. Prerequisites: EC 170, 171 172 or consent of instructor. Exams: There will be a final and a midterm. Exams will consist of a mixture of problems, short answers and essay questions and will cover material from lectures and the readings. There is a 5000 word research paper on the effect of globalization on poverty in a country of your choice. Grades: midterm (20%) the final exam (30%), paper (30%), homework (20%) Software: All homework problems will be done in Excel and submitted electronically. Some competence in Excel is assumed. (If you are unfamiliar with Excel, there are numerous tutorials available on the web.) Mathematics: Algebra and some basic calculus will be used in the course. Statistics at the level of EC 170 will be used extensively. The course syllabus is updated throughout the semester. Dates are approximate.

Part 1: Developing Countries and Poverty Traps

Aug 28-Sept 11 What is poverty and who are the poor? Can RCTs devise better policies to help the poor? Input-output, Social Accounting Matrices and linear programming. Review of linear algebra and statistical modeling in Excel.  Readings: Poor Economics Chpt 1-5,   Easterly on Econtalk, Acemoglu and Robinson, Why Nations Fail, Chpt 1, Banerjee on Econtalk, Collier on EconTalk

Part 2: Growth models

Sept 13-27  Hats, Lewis model, Solow model and optimal growth,  Readings: Mankiw, Romer and Weil, A Contribution to the Empirics of Economic Growth,  Mankiw, The Growth of Nations   Lucas, Why Doesn't Capital Flow from Rich to Poor Countries?, Lucas on EconTalk,  Barrow on EconTalk

Part 3: Institutions and Poverty

Oct 2-16. What is the effect of savings and growth on inequality and poverty? What is the functional impact of inequality?   Readings: Poor Economics, Chpt 6-7. Midterm exam: 18 October in class covering all readings and class material to date.

Part 4: Saving, Investment and Poverty

Oct 23-Nov 8. How is poverty measured? Microfinance, savings and investment. What is the functional impact of poverty?   Readings: Poor Economics, Chpt 8-9.  

Part 5: Policy

Nov 13-Dec 4. Trade, growth and poverty. Comparative advantage, import substitution and export promotion. Open Economy Macromodel (ISLMBP).   Readings: Poor Economics, Chpt 10. Rodrik, Has globalization gone to far?, Rodrik on EconTalk, Rodrik and McMillan, Globalization, Structural Change, and Productivity Growth  Notes on Mundell-Fleming

Final Exam-comprehensive. Final Exam Tues Dec 11 4:30-5:45 PM
(UVM Final exam schedule-Fall 2012)     


Banerjee and Duflo Poor Economics
Why Nations Fail
The Elusive Quest for Growth
The End of Poverty
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