Development Economics

-Toward New Political Economy of Development-


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開発経済学

-新しい開発の政治経済学を目指して-


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A Boy on the Sulaweshi Island of Indonesia

For the happiness of loving and being loved .....

(in Sulawesi, Indonesia)

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 2007-2008 Course Syllabus


(April 2007)

Last updated on May 14, 2007



Course Bulletin Board


Instructor: Prof. Shigeru Thomas OTSUBO (大坪 滋)

Lectures: Tuesdays 10:30 am. - 12 noon at GSID No.3 Lecture Hall
Ad hoc thematic presentations will be held either at the 8th floor GSID Auditorium  (in conjunciton with "Introdution to International Development (I2ID) or at the No. 1 Conference room on the 8th floor.

Office Hour: Tuesdays 1:30-2:30 pm. or by appointment at Room 704 (ext. 4966)

Teaching Assistant: Penghuy.

Classes are conducted in English.



Course Description


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) guiding development―markets vs. controls (the role of government in development, good governance); 7) development and institutions; 8) Japanese/Asian development models; 9) socio-economic development topics (education and development, environment and development, and social capital and development); 10) trade and development (import substitution, export promotion, and globalization); 11) financing development (capital and saving, financial system and development); and 12) new development challenges in the 21st century (globalization, international economic system, peace building, growth fetishism (?), etc.)


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Course Schedule: Themes and Issues

(For detailed class schedule & required readings, pay attention to the Course Bulletin Board on the web.)

April

1. Introduction to Development Economics

-- Stylized Facts & Evolving Principles in Economic Development

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);
and
4) development and equity.

Students of Development Economics should attend I2ID lectures of April 18 (Evolution and Expansion of Development Economics) and April 25 (Global Warming and International Cooperation) to be taught by myself and Prof. Fujikawa.

April-May

2. Learning Key Principles of Development Economics

-- Theoretical Arguments

5) theories of development (traditional and new growth theories);
6) dualistic development and structural change (growth, poverty, and income distribution; rural-urban dichotomy)

May-June

3. Markets vs. Controls: Building Instituions for Development Coordination

7) guiding development―markets vs. controls (forces of the market, the role of government in development, good governance);
8) development and institutions;

Extra sessions on market experiments will be given for students to experience/understand market forces.

June 4. Japanese/Asian Development Model(s)

9) post-war development of the Japanese economy;
10) East Asian Miracle--Miracle or Myth?;

July

5. Socio-Economic Development Topics


11) sustainable development (the environment and development)
12) education, HRD, and development
13) social capital for development

July

6. Looking Ahead


14) new development challenges in the 21st century (globalization, international economic system, peace building, growth fetishism (?), etc.)


7. Introduction to 'Development Management under Globalization'
---
Trade, Finance, and Development (to be continued in the 2nd Semester)

15) trade and development (import substitution, export promotion, and globalization);
16) financing development (capital and saving, financial system and development)


 

 

Textbooks and Readers


All of the books listed here are available in Prof. Otsubo's corner in our GSID Library.
Chapters and sections to be read will be specified in the class as we go.



[Textbooks for Development Economics]

Main
Michael P. Todaro, Stephen C. Smith, Economic Development, 9th edition, Addison Wesley, 2005.
[To be referred as Economic Development or ED, henceforth.]


Sub
Dwight Heald Perkins, Malcolm Gillis, Dwight G. Perkins, Michael Roemer, Steven Radelet, Donald Snodgrass, Economics of Development, 5th edition, W.W. Norton & Company, 2001.
[To be referred as Economics of Development or EOD, henceforth.]

to be replaced by

Dwight H. Perkins, Steven Radelet, and David L. Lindauer, Economics of Development, 6th edition, W.W. Norton & Company, 2006.
[To be added to the library section.]



[Readers]

Joseph Stiglitz and Gerald Meier, Frontiers of Development Economics: The Future in Perspective, Oxford U. Press, 2000.
[An evolution of development thinking, economists' version, at the turn of the century.]

Gerald M. Meier, Leading Issues in Economic Development, 6th ed., Oxford U. Press, 1995
(松永宣明、大坪滋 「国際経済開発入門」 剄草書房、1999年9月 [Japanese Translation, 上記の編訳] )
[This book always enrich your visions of development issues in a well-balanced manner.]

Gerald M. Meier and James E. Rauch, Leading Issues in Economic Development, 8th ed., Oxford U. Press, 2005
[Newer breed of the above.]

Robert J. Barro, Determinants of Economic Growth: A Cross-Country Empirical Study, MIT Press, 1997.
[A good quantitative summary of stylized facts of (economic) development.]

William Easterly, The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics, MIT Press, 2001.
[Before blaming economists for persistent poverty problems, analyze the misadventures. Hints on how to properly apply economic principles/modern growth theories on the ground.]

World Bank (Vinod Thomas ed.), The Quality of Growth, Oxford U. Press, 2000.
(世界銀行(著)、小浜裕久等(訳) 「経済成長の質」 東洋経済新報社、2002年 [Japanese Translation, 上記の編訳] )
[Stressing the role of good governance (sound development management) for the quality of growth.]

Amartya Sen, Development as Freedom, Anchor Books, 2000.
[This book extends the meaning of poverty and humnan development. A good eye-opener for concerned economists.]

James D. Wolfensohn (Foreword), Rodrigo de Rato (Foreword), Global Monitoring Report 2004: Policies and Actions for Achieving the Millennium Development Goals and Related Outcomes, World Bank Publications, 2004.

Jeffrey D. Sachs (Editor), Investing In Development: A Practical Plan To Achieve The Millennium Development Goals (UN Millennium Project), 2005.
[A good review of our development efforts and what should be done to achieve the MDGs.]

World Bank, World Development Report 2000Entering the 21st Century, 2000.
[A good summary of economic integration and global issues into the 21st century.]

World Bank, World Development Report 2000/2001Attacking Poverty, 2001.
[Every 10 years, the WB reviews the results of our fight against poverty and rethink future strageties for poverty reduction.]

World Bank, World Development Report 2006Equity and Development, 2005.
[Is growth good for poverty reduction? WDR revists the issues of Equity and Development with lots of background fact-finding analyses.]

World Bank, Globalization, Growth, and Poverty: Builidng an Inclusive World Economy, Oxford U. Press, 2002.
[An introductory analysis and fact book on the possible relationship between globalization and poverty reduction.]

Giovanni Andrea Cornia (Editor), Inequality, Growth, and Poverty in an Era of Liberalization and Globalization, Oxford Univ. Press, 2004.
[Development under globalization tends to enlarge gaps between rich and poor both internationally and domestically. What sort of development management is neccessary?]

Claude Menard (Editor), Mary M. Shirley (Editor), Handbook of New Institutional Economics, Springer, 2004.
[Lean about the essense of and new developments in New Institutional Economics.]

World Bank, The East Asian Miracle: Economic Growth and Public Policy, Oxford U. Press, 1993.
[The book that you cannot go without when looking into "the" Asian growth model.]

Joseph Stiglitz and Shahid Yusuf, Rethinking the East Asian Miracle, Oxford U. Press, 2001.
[What was the real essence of the Asian Miracle? Where are we going?]



[Resources on the Internet]

Refer to the "Exploration of Economics/Intn’l Development Resources" corner of Prof. Otsubo's Homepage for resources on the internet to be used in this course.

To Start With ...
1 世界がもし100人の村だったら
If the World were a Village of 100 People
Well, where can we, economists, contirubute?
Poverty-MDGs
2 World Bank: PovertyNet
Explore the resouces on poverty alleviation.
Links to MDGs-related sites are also available.
3 Humand Development Report 「人間開発報告」
Check out the cocepts and measurements of human development.
How dose economic development affect HDIs directly and/or indirectly?


HDI Animations
Do not miss the HDI-Income Growth animation!
This site also has a nice animation for the MDG progress.
4 Millennium Development Goals (MDGs)
Progress Report
Explore this UN window site for MDGs. Also check the progress report.

Investing in Development: A Practical Plan to Achieve the Millennium Development Goals
The way foraward to achive the MDGs. (UN report, J.D. Sacks ed.)

MDG Indicators
8 goals, 18 targets, and 48 indicators.

UNDP MDG Site
Explore this UNDP window site for MDGs.

WB MDG Site
Explore this WB window site for MDGs.
5 World Development Reports

WDR 2000/2001: Attacking Poverty
Overview -- Attacking Poverty: Opportunity, Empowerment, and Security
Chapter 1 -- The Nature and Evolution of Poverty)
Backgournd Paper 'The Evolution of Thinking about Poverty: Exploring the Interactions'
Japan's ODA
6 Japan's ODA Homepage (Japanese)
Japan's ODA Homepate (English)
What are the recent developments and directions of Japan's ODA activities?
7 Japan's ODA Charter 2003 Revision (Japanese)
Japan's ODA Charter 2003 Revision (English)
Locate keywords in this draft.
Governance-Institutions
8 World Bank Institute Thematic Site: Governance

Check WB resources on the issue of governance.

9 The IMF and Good Governance

Check IMF resources on the issue of governance.

10 UNDP Publications on Democratic Governance

Check UNDP resources on the issue of governance.

11 World Bank Thematic Site: Governance and Public Sector Reform

Check WB resources on the issue of public sector management.

12 What Should the World Bank Think about the Washington Consensus?

Update on WC by John Williamson, who coined the term 'Washington Consensus' in 1989.

13 The Washington Consensus and Beyond with John Williamson
(May 8, 2003)

B-Span Video Crips of the Arguments.

14 Debating the Washington Consensus
(June 19, 2003)

Suzan George + delegates from DAC, WB, etc.

15 Whither Reform? - Ten Years of the Transition -- "More Instruments and Broader Goals: Moving Toward the Post-Washington Consensus" by Joseph Stiglitz (1999)

Critical review of the so-called Washington Consensus.

16 "The Rise and Fall of the Washington Consensus" by Charles Gore (2000)

A critical review of the WC (WB/IMF) by an UNCTAD staff.

Japan's and Asia's Development Experiences
17 Shigeru Otsubo and Akira Furukawa
Post-war Development of the Japanese Economy---Development, Japanese/Asian Style---

A Power Point note for you to learn about Japan's post-war development experience.

18 IDE-JETRO Resources on Japanese Development Experience
Digital Archives on "The Japanese Experience: Techonology Transfer, Transformation, and Development"

A Digital Liblary created as a byproduct of their Japanese Experience Project.

Globalization-Trade & Financial Integration
19 Assessing World Bank Support for Trade 1987-2004: An IEG Evaluation

The World Bank was overly optimistic about the immediate and universal benefits of more open trade. This critical independent evaluation report confirms that liberalizaing trade alone is not enough to generate grwoth and fight poverty.

20 World Trade Organization

Check recent developments in world trading system.
New round of negotiations? China's membership? .....
Visit 'WTO News' and 'Trade Topics' corners.

21 The Doha Agenda for WTO Negotiations

Check through the negotiation agenda of the 'Development' Round.

22 GATT & WTO Agreements

See the structure of the GATT/WTO agreements.

23 World Bank Thematic Site: Globalization

Check WB resources on the issue of globalization.

24 World Bank Thematic Site: Trade

Check WB resources on the issue of trade.

25

Global Macroeconomic and Financial Policy Site
by Prof. Nouriel Roubini, Stern School of Business, New York Univ.

On-Line Tutor of Development Economics, and Virtural Case Studies
26 OnLine Tutor in Development Economics

This fantastic site provides you an on-line tutorship for you to go though basic issues, conceps, and theories in Development Economics.

27 Economic Theories in a Virtual Development Country (Zambia)

Virtural case studies of economic theories in the contect of a developing country.


These last two entries, OnLine Tutor in Development Economics and
Economic Theories in a Virtual Development Country (Zambia)
are excellent resources for you.



[Reference Books for Macro and Microeconomics (for students without economics background)]

Refer to Prof. Osada's reading list for 'Development Macroeconomics' lectures for Macroeconomics.

Refer to Prof. Shinkai's reading list for 'Development Microeconomics' lectures for Microeconomics.


[Reference Books for International Economics i.e. International Trade and International Finance]

Richard E. Caves, Jeffrey A. Frankel, and Ronald W. Jones, World Trade and Payments: An Introduction, 10th ed., Addison-Wesley Pub. Co., 2006.
[Textbook for International Trade and Finance]

Paul R. Krugman, Maurice Obstfeld, International Economics: Theory And Policy , 7th. ed., Addison-Wesley Pub. Co., 2005.


[To Aquire a Good Sense of Economics]

Also, read the following book by a 1992 Nobel Prize winner and his wife in order to train your economic thinking. This book is a collection of their essays publised in BusinessWeek , providing a bridge between economic theories and real life issues.
Gary S. Becker and G. N. Becker, The Economics of Life: From baseball to affirmative action to immigration, how real-world issues affect our everyday life, McGraw-Hill, 1996
(Japanese Translation - 邦訳)「ベッカー教授の 経済学ではこう考える」 東洋経済新報社、1998

Course participants are encouraged to associate themselves with Adam Smith, The Wealth of Nations , at the earliest possible occasion.



The following list of required and recommended readings will be continuously updated as we go. Thus, reading assignments will also be announced in the class and on our course bulletin board.


Readings and References

This list of required & recommended readings will be modified as we go. Please check this section regularly. Also pay attention to the Course Bulletin Board on the web.

Items with mark can be found in the Prof. Otsubo’s Course-Book Section (Restricted Circulation) in the GSID Library.
An Entire List of Books for Restricted Circulation

Items with ** mark are required readings.

Items with * mark are highly recommended readings.

Items with (A) mark are for more advanced leaners.

 


Stylized Facts & Evolving Principles in Economic Development

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

**Economic Development, 9th ed., Chapters 1(**), 2 (**) and 5 (**).
plus

*
Economics of Development, 5th ed., Chapters 1(*).
[EOD Ch.1 would be a wonderful addition to the readings from ED for those who study Economics of Development for the first time.]

**Frontiers of Development Economics:
Read (**)“Introduction: Ideas for Development”and (**)"The Old Generation of Development Economists and the New" by Gerald M. Meier,
(**)“Development Issues: Settled and Open” by Shahid Yusuf and Joseph E. Stiglitz,
and (*)"The Evolution of Thinking about Poverty: Exploring the Interactions" by Ravi Kanbur and Lyn Squire (this section can be downloaded).
["The Old Generation of Development Economists and the New" will be presented/explained in the I2ID lecture on April 18.]
["The Evolution of Thinking about Poverty" is refected in Chapter 1 of WDR 2000/2001-Attacking Poverty.]

**World Bank, World Development Report 2000/2001―Attacking Poverty.
Read Chapters 1-3.

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

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

**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.

*W.A. Lewis, "Is Economic Grwoth Desirable?," Appendix to The Theory of Economic Grwoth, Irwin, 1955.

*Leading Issues in Economic Development, 8th ed., Chapters I.A, I.B, II., and Chapter VIII.
OR
*Leading Issues in Economic Development, 6th ed., Chapters I and II.A.
[For the 6th ed., Japanese Version is available as 「国際開発経済学入門」]

*World Bank (Vinod Thomas ed.), The Quality of Growth, Oxford University Press, 2000.
Read Overview and Chapter 1 for now.

*Robert J. Barro, Determinants of Economic Growth: A Cross-Country Empirical Study, MIT Press, 1997.
[To be discussed in the class.]

*(**)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.

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.



Economic Growth Models and Theories: Growth Theories, Income Convergence?, Determinants of Growth, and Agriculture vs. Industry (Rural vs. Urban Sectors)

**Economic Development, 9th ed., Chapters 3 and 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.

**Robert J. Barro, Determinants of Economic Growth: A Cross-Country Empirical Study, MIT Press, 1997.
Read Chapter 1: Economic Growth and Convergence. [To be discussed in the class.]

*Frontiers of Development Economics.
Read “Fallacies in Development Theory and Their Implications for Policy" by Irma Adelman, and (A) "ModernEconomic Theory of Development" by Karla Hoff and J.E. Stiglitz.

*The Elusive Quest for Growth.
Read Part II: Panaceas That Failed, Chapter 3: Solow's Surprize: Investment Is Not the Key to Growth.

*World Bank, World Development Report 2000―Entering the 21st Century.
Read Overview, Introduction, and Chapter 1 for now.

**Leading Issues in Economic Development, 8th ed., Chapter I.C.
OR
**Leading Issues in Economic Development, 6th ed., Chapters II.B, II.C, and III.
[For the 6th ed., Japanese Version is available as 「国際開発経済学入門」]




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Interested readers should also explore the papers and books cited in these sections of Leading Issues (6th and 7th eds.). Items by Arrow,
Bhagwati, Chenery, Hirshman, Lewis, Romer, Rostow, Schults, Singer, Solow, Stiglitz are highly recommended.
Otsubo seminar M1 sessions will read some of these original papers.
The following entries-original works on development theories-are (*) items for studens in EDP&M program.
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Xeroxed copies of most of the articles in this subsection are available in the GSID Library (reserved box).

*Jagdish Bhagwati, "Development Economics: What Have We Learned?" Asian Development Review, Vol.2, No. 1 (1984), pp. 24-29.
[As a starter and as an introduction to import-substituting development strategy.]

*Albert O. Hirschman, "Political Economy of Import Substituting Industrialization," Quarterly Journal of Economics (February 1968).
[On the policital economy of import substitution.]

*David Ricardo, "On Foreign Trade," Chapter 7 in On the Principles of Pollitical Economy and Tazation (1817).
[Download and read this theory of 'Comparative Advantage.']

*W.W. Rostow, "The takeoff into Self-Sustained Grwoth," in Agarwala and Singh, The Economics of Underdevelopment, Oxford Univ. Press, 1963, pp. 154-186.
[On 'Stages-of-Development' theory and 'take-off.']

*W.A. Lewis, "Economic Development with Unlimited Supplies of Labor," Manchester School (May 1954).
Reprinted in Agarwala and Singh, The Economics of Underdevelopment, Oxford Univ. Press, 1963, pp. 400-435.

*P.N. Rosenstein-Roden, "Problems of Industrialization of Eastern and Southeastern Europe," Economic Journal (June-September 1943).
[On 'Big Push.']

*Kevin M. Murphy; Andrei Shleifer, and Rovert W. Vishny, "Industrialization and the Big Push," The Journal of Political Economy (October 1989).
[On 'Big Push.']

*Harvey Leibenstein, Economic Backwardness and Economic Growth (1957), Chapter 8.
[On 'Critical Minimum Effort.']

*Richard R. Nelson, "A Theory of the Low-Level Equilibrium Trap in Underdeveloped Economies," American Economic Review (December 1956), pp. 894-908.
[On 'Low Level Equilibrium Trap.']

*Ragnar Nurkse, Problems of Capital Formation in Underdeveloped Countries (1953), pp.13-15.
[On 'Balanced Growth.']

*Albert O. Hirschman, The Strategy of Economic Development (1958).
[On 'Unbalanced Growth.']

*Gunnar Myrdal, Economic Theory and Underdeveloped Regions (1957).
*Raul Prebisch, "The Ecobomic Development of Latin America and Its Principal Problems," Economic Bulletin for Latin America ,7 (1950).
*Hans Singer, "Gains and Losses from Trade and Investment in Underdeveloped Countries," American Economic Review (May 1950).
[On the 'Export Pessimism.' that led to the 'Dependency Theory.']

On top of the secion II.C: Alternative Perspectives, II.D.1. Dependency Therories of Underdevelopment inLeading Issues in Economic Development, 6th ed.
*Osvaldo Sunkel, "National Development Policy and External Dependence in Latin America," Journal of Development Studies (October 1969): 31.
*Osvaldo Sunkel, "Transnational Capitalism and National Disintegration in Latin America," Social and Economic Studies (March 1973), pp. 132-76.
*Samir Amin, "Underdevelopment and Dependency, " Journal of Modern African Studies, Vol. 10 (1972).
*Enmer L. Bacha, "An Interpretation of Unequal Exchange from Prebish-Singer to Emmanuel, " Journal of Development Economics, Vol. 5 (1978).
[On 'Dependency Theories.']
*Sanjaya Lall, "Is 'Dependence' a Useful Concept in Analyzing Underdevelopment?" World Development (November-December 1975).
[On citical review of the 'Dependency Theories.']

*World Bank, Redistribution with Growth (1974).
[Stop waiting for the 'Trickle Down' to happen.]

*International Labor Organization, The Basic Needs Approach to Development (1977).
[On the 'BHN' approach.]

*T.W. Schultz, "Investment in Human Capital," American Economic Review (March 1961), pp. 1-17.
[From physical capital to 'Human Capital.']

*Frances Stewart, Technology and Underdevelopment (1977).
[On the proper 'Technology' to borrow.]

*Paul M. Romer, "Increasing Returns and Long-run Growth," Journal of Political Economy , Vol. 94 (October 1986), pp.1002-37.
[On the 'AK approach' to the New Endogenous Growth Model.]

*Paul M. Romer, "Endogenous Technological Change," Journal of Political Economy, Vol. 98 (October 1990), pp.71-102.
[On the 'neo-Schumpeterian pproach' to the New Endogenous Growth Model.]


*Albert O. Hirshman, "The Rise and Decline of Development Economics," Chapter 1 in Essays in Trespassing: Economics to Politics and Beyond (1981).
[Development Economics was to be dominated by the Economics of Developed?]

*Ann O. Krueger, "Aid in the Development Process," World Bank Research Observer (January 1986), pp. 62-63.
[On the resergence of Neoclassical Economics.]

*Amartya K. Sen, "Development Which Way Now?" Economic Journal (December 1983).
*W. Arthur Lewis, "The State of Development Theory, " American Economic Review (March 1984).
[On the continuing role of Development Economics.]

On top of the secions II.B.2: Neoclassical Analysis, II.B.3: Structural Analysis inLeading Issues in Economic Development, 6th ed.
*Robert M. Solow, "A Contribution to the Theory of Economic Growth," Quarterly Journal of Economics (February 1956).
[On the neoclassical 'Solow Growth Model.']

*Prnab Bardhan, "The New Institutional Economics and Development Theory," World Development, Vol. 17, No. 9 (1989), pp. 1390-1394.
[Reprinted as secion II.B.6: The New Institutional Economics and Development Theory in
Leading Issues in Economic Development, 6th ed.]

On top of the secion II.B.5: New Endogenous Growth Theory inLeading Issues in Economic Development, 6th ed.
*Kenneth Arrow, "The Economic Implications of Leaning by Doing," Review of Economic Studies (June 1962), pp.155-73.
[On a dynamic interpretation of increasing returns.]

*Paul M. Romer, "Increasing Returns and Long-run Growth," Journal of Political Economy , Vol. 94 (October 1986), pp.1002-37.
[On the 'AK approach' to the New Endogenous Growth Model.]

*Paul M. Romer, "Endogenous Technological Change," Journal of Political Economy, Vol. 98 (October 1990), pp.71-102.
[On the 'neo-Schumpeterian pproach' to the New Endogenous Growth Model.]

(A) Robert J. Barro and Xavier Sala-i-Martin, Economic Growth, McGraw-Hill, 1995.

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Students in Rural/Regional Development Development Program should also read the following entries.

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**Economic Development, 9th ed., Chapter9: Agricultural Transformation and Rural Development.
AND
**
Economics of Development, 5th ed., Chapter 15: Agriculture and Chapter 16: Primary Exports.

**Leading Issues in Economic Development, 8th ed., Chapters VI and VII.

*W.A. Lewis, "Economic Development with Unlimited Supplies of Labor," Manchester School (May 1954).
Reprinted in Agarwala and Singh, The Economics of Underdevelopment, Oxford Univ. Press, 1963, pp. 400-435.





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, 9th ed.
Chapter 11: Development Policymaking and the Roles of Market, State, and Civil Society.

OR

**Economics of Development, 5th ed.
Chapter 5: Guiding Development: Markets versus Controls.

OR

**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.
OR
*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.




East Asian Growth Model--Miracle or Myth?----Japan's & Asia's Development Experiecnes--Beyond the Asian Financial Crisis

**Shigeru Otsubo and Akira Furukawa, Post-war Development of the Japanese Economy---Development, Japanese/Asian Styoe---, PowerPointNote, 2007.

**World Bank, The East Asian Miracle: Economic Growth and Public Policy, Oxford U. Press, 1993.

Alwyn Young, "The Tyranny of Numbers: Confronting the Statistical Realities of the East Asian Experience," NBER Working Paper, No. 4680 (1994).

**Paul Krugman, "The Myth of Asia's Miracle," Foreign Affairs, Vol. 73, No. 6 (November/December 1994).

Jong-Il Kim and Lawrence J. Lau, "The Role of Human Capital in the Economic Growth of the East Asian Newly Industrialized Countries," Asia-Pacific Economic Review, Vol. 1, No. 3 (December 1995).

**Michael Walton, "The Maturation of the East Asian Miracle," Finance & Development (September 1997).

Joseph Stiglitz and Shahid Yusuf eds., Rethinking the East Asian Miracle, WB-Oxford University Press, 2001.



Sustainable Development (For those students interested in the issues of "Development and Environment.")

**Economic Development, 9th ed., Chapter 11: The Environment and Development.
OR
**
Economics of Development, 5th ed., Chapter 6: Sustainable Development.
OR
**
Economics of Development, 6th ed., Chapter 20: Sustainable Development.

**World Bank, World Development Report 2000―Entering the 21st Century,
Chapter 4: Protecting the Global Commons.

*Leading Issues in Economic Development, 8th ed., Chapter X.



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Students in Educational/Human Resource Development Program should go for the following entries.

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Education and Development (For those students interested in the issues of "Education and Development.")

**Economic Development, 9th ed., Chapter 8: Human Capital: Education and Health in Economic Development.
Read sections related to Education and Development.

OR
**
Economics of Development, 5th ed., Chapter 9: Education.

**The Elusive Quest for Growth.
Read Part II: Panaceas That Failed, Chapter 4: Educated for What?

**Leading Issues in Economic Development, 8th ed., Chapter IV.A.: Education.
OR
*Leading Issues in Economic Development, 6th ed., Chapter VI.F: Education.
[For the 6th ed., Japanese Version is available as 「国際開発経済学入門」]

*G.S. Becker, Human Capital, Cambridge University Press, 1964.
佐野陽子訳 「人的資本論」 東洋経済新報社 1976. 

**T.W. Schultz, "Investment in Human Capital," American Economic Review (March 1961), pp. 1-17.
[From physical capital to 'Human Capital.']

*T.W. Shultz, "The economic value of education", The Economic Value of Education, Columbia University Press, 1963.
清水義弘・金子元久訳 「教育の経済価値」 日本経済新聞社 1981. 

L. Thurow, Generating Inequality, Basic Books, 1976.

(A) G.A. Akerlof and R. Kranton, "Identity and schooling: some lessons for the economics of education", Journal of Economic Literature, Vol.40, No.4, pp. 1167-1201 (2002).

(A) D. Card, "The causal effect on education on earnings", in Handbook of Labor Economics, Vol. 3B, edited by O. Ashenfelter and R. Layard, Elsevier Science Publishers B.V., pp. 1801-1863.

(A) E.P. Lazear, "Educational production", Quarterly Journal of Economics, Vol.116, No.3, pp. 777-803 (2001).




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International Aspects of Economic Development will be mainly dealt in the 2nd Semester in
"Development Management under Globalization" as a sequal to this course (Development Economics).

In this Development Economics Lecture, I will try to provide introduction/linkages to the subjects of
International Development Economics.

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International Development Economics: Introduction to "Development Management under Globalization (2nd Semester)"

**World Bank, World Development Report 2000―Entering the 21st Century,
Introduction: New Directions in Development Thinking,
Chapter 1: The Changing World.

Trade Integration--Trade and Development--GATT/WTO:

**Economic Development, 9th ed., Chapters 12 and 13.

**World Bank, World Development Report 2000―Entering the 21st Century,
Chapter 2: The Wolrd Trading System: The Road Ahead.

*(**)David Dollar and Aart Kraay, "Trade, Growth, and Poverty," Policy Research Working Paper No. 2615, The World Bank (2001).
[PDF file is here.] This paper is (**) for EDP&M major.

**Assessing World Bank Support for Trade 1987-2004: An IEG Evaluation
The World Bank was overly optimistic about the immediate and universal benefits of more open trade. This critical independent evaluation report confirms that liberalizaing trade alone is not enough to generate growth and fight poverty.

Leading Issues in Economic Development, 8th ed., Chapter III..A
OR
Leading Issues in Economic Development, 6th ed., Chapters VII.B and IX.
[For the 6th ed., Japanese Version is available as 「国際開発経済学入門」]

Financial Integration--External Finance and Development (FDI and MNCs, Other Capital Flows):

**Economic Development, 9th ed., Chapters 14 and 15.

**World Bank, World Development Report 2000―Entering the 21st Century,
Chapter 3: Developing Countries and the Global Financial System.

*Leading Issues in Economic Development, 8th ed., Chapters III.B and V
OR
*Leading Issues in Economic Development, 6th ed., Chapters IV and V.
[For the 6th ed., Japanese Version is available as 「国際開発経済学入門」]




Stabilization and Structural Adjustments--IMF and the World Bank:

**Economic Development, 9th ed., Chapter 16.
OR
**
Economics of Development, 5th ed., Chapters (11,) 12, and 19.

Leading Issues in Economic Development, 6th ed., Chapters VII.A,C,D.
[For the 6th ed., Japanese Version is available as 「国際開発経済学入門」]

*Michael Bruno, Deep Crises and Reform: What Have We Learned?, The World Bank, 1996.

Development Management under Globalization: Globalization, Governance and the Nation State

**Economic Development, 9th ed., Chapter 17.

*Globalization in Question: The International Economy and the Possibilities of Governance, 2nd rev. ed., Chapters 7 and 9.

World Bank (Vinod Thomas ed.), The Quality of Growth, Oxford University Press, 2000, Chapters 6 and 7.

Robin Cohen and Paul Kennedy, Global Sociology, New York University Press, 2000.
Chapters 1, 2, 5, 11, 14 and 20.

Globalization and Inequality--Poverty Reduction

*Economics of Development, 5th ed., Chapter 4.

**World Bank, World Development Report 2006―Equity and Development.
Read Chapter 3: Equity from a global perspective, Chapter 9: Markets and the macroeconomy, and Chapter 10: Achieving greater global equity.

**David Dollar, "Globalization, Poverty, and Inequality since 1980," Policy Research Working Paper No. 3333, The World Bank (2004).
[PDF file is here.]

*(**)David Dollar and Aart Kraay, "Trade, Growth, and Poverty," Policy Research Working Paper No. 2615, The World Bank (2001).
[PDF file is here.] This paper is (**) for EDP&M major.

Leading Issues in Economic Development, 8th ed., Chapter VIII.

*World Bank (Vinod Thomas ed.), The Quality of Growth, Oxford University Press, 2000, Chapters 2 and 3.

World Bank, World Development Report 2000/2001―Attacking Poverty.

*UNDP, Human Development Report 1999 -- Globalization with a Human Face, Oxford University Press, 1999.

Robin Cohen and Paul Kennedy, Global Sociology, New York University Press, 2000.
Chapter 8.

Asian Development Bank, Escaping the Poverty Trap: Lessons from Asia, (1995)


Grading Policy

An essay-type final exam (with a term paper option) will be given at the end of the semester. Short quizes may be conducted from time to time in order to confirm your understanding of basic principles of development economics. Details will be discussed in the class. Your class participation and contribution will also be an additional grading factor.




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