6088 - DEVELOPMENT POLICY

This course examines major current issues in less developed countries and provides an introduction to the study of development economics. More specifically, the course examines the major debates in the problems of development economics and integrate economic theory and empirical analysis to answer questions pertinent to economic policy in developing economies.

Topics covered in the first part of the course include: theories of economic growth focused on developing countries, geography and institutions, human capital (education and health); public goods provision; and gender and development. This part of the course also emphasizes the application of econometric program evaluation methods in development economics.

The objective of the second part of the course is to provide a better understanding of the complex nature of policymaking by looking at persistent problems in the formulation and implementation of policies in development countries. On the other hand, we discuss some examples of program failures and successes, with special emphasis on the different roles played by the market, the State, and the actual society. On the other, we also put some attention on the interaction between development policy and other areas of -potentially conflicting- concern for policymakers such as social polarisation, globalization, or the sustainbility of the environment. With constant reference to recent theoretical and empirical work in economics, this part of the course will then address questions like: How effective have development policies been so far? Do some societies need to be taken out of ‘poverty traps’? Is privatisation good or bad for the poor? Does ethnic conflict inhibit development? Is inequality an inevitable consequence of economic growth? Does globalization benefit only the rich? Are development policies bad for the environment?

• Theories of economic growth 
• Geography and institutions in developing countries  
• Human capital (education and health)  
• Gender and development  
• The failure of development policy
• Market, State, and persistent problems in policymaking 
• Polarisation and economic growth
• Globalization and the poor
• Development policy and the environment

Written Exam
Students have two options. They may take the exam in two written parts: 1st partial exam and a 2nd partial exam and each part accounts for 50% of the grade (Students must pass both partial exams in order to receive a final grade). Alternatively, they may take a general written exam covering the entire course material.

A complete and up-to-date reading list will be provided at the beginning of the course. The reference books for this course are:

• W. EASTERLY, The Elusive Quest for Growth, MIT Press, 2002 (compulsory) 
• D. RAY, Development Economics, Princeton Univ. Press, 1998
  (not compulsory to purchase)
• M. P. TODARO and S. C. SMITH, Economic Development -Tenth edition-, Addison-Wesley, 2009 (not compulsory to purchase)
  

Readings and material for the topics covered in the class will be available at the beginning of the course.