Bulletin Board
Development Economics

"Toward New Political Economy of Development"

Core Course for
Economic Development Policy & Management (EDP&M) Program

1st Semester, 2009-2010

As the core discipline subject of the DID’s Economic Development Policy & Management (EDPM) Program, this course offers key principles and issues of Economics of Development bearing the needs of first-time learners in mind. Topics to be covered are: 1) the role of economic development in “development” and poverty reduction (in conjunction with attaining the MDGs); 2) the evolution of economic development thoughts; 3) the stylized facts in economic development (open and closed questions); 4) theories of development (traditional and new growth theories); 5) dualistic development and structural change (growth, poverty, and income distribution; rural-urban dichotomy); 6) education and development; 7) sustainable development (the environment and development); 8) trade and development (import substitution, export promotion, and globalization); 9) financing development (capital and saving, financial system and development); 10) guiding development―markets vs. controls (the role of government in development, good governance); 11) development and institutions; and 12) new development challenges in the 21st century (globalization, international economic system, peace building, growth fetishism (?), etc.)

Date of Entry

to be provided Course Evaluation Sheets !!

You (either you are registered or auditting students) will be requested to fill one of the following course evaluation sheets and submit them in the lecture on July 14 or July 21.

Development Economics 2009 Course Evaluation Sheet (English)
Development Economics 2009 Course Evaluation Sheet (Japanese)

These will be used for me to improve the contents of this course for future students. Your kind inputs will be most highly appreciated.

Thank you in advance.

Instructor: Prof. Shigeru T. Otsubo

to be provided Final Exam

Final Exam for Development Economics 2009 will be a take-home exam. I will give you exam sheets (in return to your Course Evaluation Sheets) and explain grading policies in July 14 lecture.

July 3, 2009

Market Experiments

-- Results from Part I: Forces of the Markets?

ME_I_Perfect Competition
ME_I_Fragmented Markets

Download and analyse the results from our market experiments on June 30.

I need at least one volunteer to present Bureaucrat's market management, and another to preent Central Planner planning.
Send me your offer by EM. Fist come first served basis. 5 points for this iniative.

June 22, 2009 Japanese Development Experience & Japnase Market System(s)

On June 14 and 21 (if not a sit-in exam), we will review Japanese development experience and Japanese market systems. There will be another lecture given during the couse of JADE (Japanese Development Experience), a reuired course in the second semester. However, these sessions will be a great opportunity for you to ask about Japanese development models.

You should download and read the following note before you come to the presentation/discussion.
Post-war Development of the Japanese Economy (Notes for EDP&M Students)

June 22, 2009

Market Experiments

-- Part I: Forces of the Markets?
-- Part II: Can we supply Puclic Goods? Can we cooperate for development?

Starting on June 23, we will conduct market experiments so that you can feel/understand the market forces for us to discuss the key isseus of markets vs. goverrment controls/coordination for development.

On June 23, 30 and July 7 lectures, classes may strech over 12 noon so that we can finish experiments in suitable blocks. Prepare for quick lunches.

Bring a caluculator with you to these market experiment sessions!!

I will post the results from our experiments in this BB. Evaluate the results by yourselves before you come to the next session.

Reading Requirements

Market Experiments: The Feel of Market Forces & The Roles of Governments

**Prof. Otsubo's Materials for Market Experiments (to be distributed in the class).

**Joseph E. Stiglitz, Principles of Micro-Econonmics, 2nd ed., W.W. Norton & Co., 1997 (Or any other edition).
Read Chapter 7: The Public Sector, (This short chapter will be distributed in the class.)

*Joseph E. Stiglitz, Economics of the Public Sector, 3rd ed., W.W. Norton & Co., 2000.
Read Chapter 1: The Public Sector in a Mixed Economy, and
Skim through Chapter 2: The Public Sector in the United States .
Read Chapter 3: Market Efficiency, Chapter 4: Market Failures, and Chapter 6: Public Goods.

For those who are interested in Experimental Economics:
(A)Daniel Friedman and Shyam Sunder, Experimental Methods: A Primer for Economists, Cambridge University Press, 1994.
(A)川越、内木、森、秋永 訳、「実験経済学の原理と方法」、同文館、1999)

Market vs. Government Control in Economic Development: Building Instituions for Development Coordination

**Economic Development, 10th (or 9th) ed.
Chapter 11: Development Policymaking and the Roles of Market, State, and Civil Society.


**Economics of Development, 6th ed.
Chapter 5: States and Markets.

**Development as Freedom.
Read Chapter 5: Markets, State and Social Opportunity.

*Yoichiro Ishihara, "Economic Governance and Economic Performacne in Developing Countrires," Forum of International Development Studies, Vol. 19 (Oct, 2001)
Excertpts will be distuributed in the class.
Download and read the full paper!

*Leading Issues in Economic Development, 8th ed., Chapter IX.
*Leading Issues in Economic Development, 6th ed.
Read Chapters X: Markets, Government, and Policy, VII.B: Promoting Industrialization, and VII.D: Privatization.
[For the 6th ed., Japanese Version is available as 「国際開発経済学入門」]

*World Bank, World Development Report 2002Builidng Instituions for Markets, 2002.

May 18, 2009 May-June Lectures: Growth Theories & Structural Models

Starting on May 27, we will deal with Growth Theories/Models. You are supposed to work on the required readings (**) in
Economic Growth Models and Theories: Growth Theories, Income Convergence?, Determinants of Growth, and Agriculture vs. Industry (Rural vs. Urban Sectors) section of the reading list by the end of the second week of June.

May 19, 26 Lectures:
Stages of Development, Balanced vs. Unbalanced Growth Models, Dependency Theory
Basic Growth Model + Harrod-Domar Growth Model

**Robert J. Barro, Determinants of Economic Growth: A Cross-Country Empirical Study, MIT Press, 1997.
Read Chapter 1: Economic Growth and Convergence.

***Economic Development, 10th (or 9th) ed., Chapter 3.

June 2 Lecture:
HD Growth Model, Neo-Classical Growth Model

***Economic Development, 10th (or 9th) ed., Chapter 3.

June 9 Lecture:
Endogenous Growth Model + Two-Sector Model (+Rural-Urban Migration Model)

**Economic Development, 10th (or 9th) ed., Chapter 4.

**Economic Development, 9th ed., Chapter 7.
'Migration and Development' (**) and 'Toward an Economic Therory of Rural-Urban Migration' (**)) for the Migration Model. (*) for other sections.

For ** and * items, refer to the online course syllabus.


Students in Rural/Regional Development Program should also read:

**Economic Development, 10th (or 9th) ed.,

Chapter 7: Urbanization and Rural-Urban Migration (remaining sections), AND

Chapter 9: Agricultural Transformation and Rural Development.



Students in Education/Human Resource Development Program should also read:

**Economic Development, 10th (or 9th) ed.,

Chapter 8: Human Capital: Education and Health in Economic Development AND

*Galor, Oded and J. Zeira, "Income Distribution and Macroeconomics," Review of Economic Studies, Vol. 60 (1993), pp. 35-52.
[What does the indivisibility of education/HR investment mean in chronic poverty?]

[The simplified model may be introduced when
Eternal Triangle of Poverty-Growth-Inequality is discussed.]


March 30, 2009
(Updated on April 13)

First lecture of 'Development Economics' (EDP&M Core Course) will meet on Tuesday, April 14 in the #3 Lecture Hall (10:30 a.m. - 12 noon).

In this first meeting of Development Economics, I will explain the design of the EDP&M course, and how the lectures of the course are inter-related.

Visit EDP&M homepage:


Then, I will explain the purpose/structure of & infrastructure for 'Development Economics' .

April 14: Introduction to 'Development Economics'

1) Visit online course syllabus from the top page (to be updated by April 14).

2) Download course discussion materials as we go.

For the month of April, you should read the required (all) and recommended (as much as possible) entries in the Stylized Facts & Evolving Principles in Economic Development section of reading list in our online course syllabus.

April Lectures:
The Review and Overview of Development Thoughts by Economists

A review of development thinking by economists will be presented, focusing on what development economists thought the major cause(s) of poverty. Then the roles of Economic Growth/Development in ‘Development’ should be discussed. Benefits and limits of Income Growth will be revisited in the context of the ‘Poverty as Capability Deprivation’, and of the ‘Human Development’. At the end of the session, the expanding sphere of Development Economics will be introduced.

Reading Assignments (by the end of the 'golden week'):
(from Stylized Facts & Evolving Principles in Economic Development)

The standard undergraduate textbook of Development Economics by Todaro and Smith will be most suitable for those without Economics background. Tenth edition is just out and paperback copies are available at the Co-op Bookstore.

Evolution of Development Thought

***Prof. Otsubo's PowerPoint Presentations & Handouts:
1) The Evolution of Development Thought: An Economist's Overview,
2) Revolutions and the Evolution of Economic Systems.

Evolution of Development Thought
Evolution of Development Thought (Summary)

Evolution of Socio-Economic System (Summary)

Evolution of a Development Paradigm (Simplified)

***Economic Development, 10th (if not, 9th) ed., Chapters 1(**), 2 (**) .

***Frontiers of Development Economics:
Read (**)“Introduction: Ideas for Development”and (***)"The Old Generation of Development Economists and the New" by Gerald M. Meier,

**World Bank, World Development Report 2000/2001―Attacking Poverty.
Read Chapters 1-2.

**Development as Freedom.
Read “Introduction: Development as Freedom", Chapter 1: The Perspective of Freedom, and Chapter 4: Poverty as Capability Deprivation.

*Albert O. Hirshman, "The Rise and Decline of Development Economics," Chapter 1 in Essays in Trespassing: Economics to Politics and Beyond (1981).
This paper is (**) for EDP&M major.

Xerox copies of the key articles will be provided in the April 14 lecture. Only 25 copies will be provided, on the FCFS basis.

By the way, if you wish to review the history of the global economic system, refer to the following handouts. For the period up to the WWII...

Global Economic System 1

For the evolution after the WWII, refer to the following documens. Doccument #3 contains links with the evolution of development thought.

Global Economic System 2
Global Economic System 3

Stylized Facts of Economic Development
+ Open and Settled Questions

***HDR animation: Human Development and Income Growth (HDR2004)
Human development and income growth 2004

***Frontiers of Development Economics:
“Development Issues: Settled and Open” by Shahid Yusuf and Joseph E. Stiglitz,

**World Bank, World Development Report 2000/2001―Attacking Poverty.
Read Chapters 1-2.

*The Elusive Quest for Growth.
Read Part I: Why Growth Matters, Chapter 1: To Help the Poor.

*(**)Aart Kraay and David Dollar, "Growth is good for the poor," Policy Research Working Paper No. 2587, The World Bank (2001).
[PDF file is here.] This paper is (**) for EDP&M major.

*Robert J. Barro, Determinants of Economic Growth: A Cross-Country Empirical Study, MIT Press, 1997.

Development and Equity

***Prof. Otsubo's PowerPoint Presentations & Handouts:
3) Poverty-Growth-Inequality Triangle

Eternal Triangle of Poverty-Growth-Inequality

For those who can read Japanese documents:
**Shigeru Otsubo, "The Eternal Traiangle of Growth, Inequality, and Poverty Reduction," Forum of International Development Studies, No. 36 (March 2008), pp. 21-44. [DP version}

***Economic Development, 10th (if not, 9th) ed., Chapter 5 (**).

**World Bank, World Development Report 2000/2001―Attacking Poverty.
Read Chapter 3.

**World Bank, World Development Report 2006―Equity and Development.
Read Overview, Chapter 1: Introduction and Chapter 4: Equity and well-being.

Development with De-Population / Aging Population

***Prof. Otsubo's PowerPoint Presentations & Handouts:
4) Development with De-Population /Aging Population

Development with De-Population / Aging Population

**Economic Development, 10th (if not, 9th) ed., Chapter 6.

Explore No.1 through No.5 of the designated site by the end of April.
Also vist No.24 (on-line tutor) and No.25 (virutal case study) of the designated site as we go in order for you to navigate and summarize issues that we deal with, and to see the relevance of them on the ground.


*Majority of reading materials should be available in the designated section (Prof. Otsubo's corner) in the GSID library.

*No prerequisites for this course. This course accommodates non-economists as well as semi- to full-economists.

*Students in Economic Development Policy & Management Program should take Development Microeconomics, Development Macroeconomics, and Development Statistics concurrently.

See you all in the class!

Prof. Otsubo