6088 - DEVELOPMENT POLICY
CLEAM - CLES - CLEF - BIEM
Course taught in English
Go to class group/s: 31
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: geography and institutions in developing countries, human capital (education and health); gender and development; public goods provision; corruption. 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 importance of financial development (or lack thereof). Starting from a macro perspective, the course begins by noting that famous economists ignore or reject the role played by financial development on economic growth. We review why this is a mistake, why and when such a role is important, and how we can measure it. We then return to the micro perspective emphasised in the first part of the course by attempting to answer the following two questions: 1) What are the investment and financing constraints faced by firms; and 2) Why is it that so many households in the developing world cannot borrow in order to pull themselves out of poverty? We study innovative policy interventions in response to the financial market imperfections that limit firm and household borrowing, with a special focus on microfinance.
Course Content Summary:
- Geography and institutions in developing countries
- Human capital (education and health)
- Gender and development
- Public goods provision
- Effect of financial development on growth
- Theories of financial development
- Investment and financing constraints
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:
- B. ARMENDARIZ and J. MORDUCH, The Economics of Microfinance, MIT Press, 2007 (compulsory)
- D. RAY, Development Economics, Princeton Univ. Press, 1998
(not compulsory to purchase)
Readings and material for the topics covered in the class will be available at the beginning of the course.