G6215: Macroeconomic Analysis I, Part 1

First Year Ph.D.Program, Columbia University

Fall 2008

Professor Xavier Sala-i-Martin

Reading List

BASIC TEXTS:



TENTATIVE (AND DYNAMIC) LIST OF TOPICS AND READINGS

(A) DYNAMIC MATHEMATICAL TOOLS IN CONTINUOUS TIME.

Before we start doing economics, we will devote some classes to mathematical tools.

The material will be taken from the mathematical appendix in Barro & Sala-i-Martin (2003).


(B) INVESTMENT THEORY.

  1. Neoclassical Theory.
    1. BX Chapter 1 (section 1.2.3) and Chapter 2 (section 2.2)
    2. (*) Hall R. and D. Jorgenson, "Tax Policy and Investment Behavior", American Economic Review. June 1967.
    3. Jorgenson, D., "Capital Theory and Investment", American Economic Review, May 1963.
    4. (*) Sala-i-Martin, X., "Internal and External Adjustment Costs in the Theory of Fixed Investment", class notes. Figures.
  2. Internal Adjustment Costs and q-Theory.
    1. (*) Hayashi, F., "Tobin's Marginal q and Average q: A neoclassical Interpretation", Econometrica, January 1982, 213-224.
    2. Lucas, R., "Adjustment Costs and the Theory of Supply", Journal of Political Economy., 1967
    3. (*) Sala-i-Martin, X., "Internal and External Adjustment Costs in the Theory of Fixed Investment", class notes. Figures.
    4. Summers, L., "Taxation and Corporate Investment: A q Theory Approach", Brookings Papers of Economic Activity, 1981:1.
    5. Tobin, J., "A General Equilibrium Approach to Monetary Theory", in Journal of Money Credit and Banking, Feb. 1969.
    6. Tobin J., and W. C. Brainard, "Pitfalls in Financial Model Building", American Economic Review. May 1968.
  3. Residential Investment and External Adjustment Costs.
    1. (*) Sala-i-Martin, X., "Internal and External Adjustment Costs in the Theory of Fixed Investment", class notes. Figures.
    2. Mankiw, N. G. and D. Weil, "The Baby Boom, the Baby Bust and the Housing Market", Regional Science and Urban Economics, May 1989.
    3. Poterba, J., "Tax Subsidies to Owner Occupied Housing: An Asset Market Approach", Quarterly Journal of Economics, 1984.
    4. Poterba, J., "House Price Dynamics", Brookings Papers of Economic Activity, 1991 (II).

(B) ECONOMIC GROWTH

I. Introduction to Growth.

  1.  Growth, Poverty, and Welfare: The World Distribution of Individual Income
    1. Balla, Surjit, "Imagine there is No Country", Institute for International Economics, 2002. 
    2. Bourguignon, F. and C. Morrisson, C., (2002) , "Inequality Among World Citizens: 1820-1992", forthcoming American Economic Review.
    3. Cowell, F.A., "Measuring Income Inequality", 2nd Edition, Harvester Wheatsheaf, Hemel Hempstead, 1995.
    4. Chen, S. and M. Ravallion, "How did the world's poorest fare in the 1990s", World Bank Working Paper, 2002. http://www.worldbank.org/research/povmonitor/pdfs/methodology.pdf
    5. Dollar, D. and A. Kraay, "Growth is Good for the Poor", Working Paper World Bank, 2000. http://www.worldbank.org/research/growth/pdfiles/growthgoodforpoor.pdf
    6. Dowrick, S. and M. Akmal, "Contradictory Trends in Global Income Inequality: A Tale of Two Biases", mimeo Australian National University, 2002. http://ecocomm.anu.edu.au/economics/staff/dowrick/world-inequ.pdf
    7. Quah, D. "One Third of the World's Growth and Inequality", mimeo LSE, April 2002. http://econ.lse.ac.uk/staff/dquah/p/0204-1third.pdf
    8. Ravallion, M. and Chen C. "How did the World's Poor Fare in the 1990s?", mimeo the World Bank (2001)
    9. Sala-i-Martin, X. "The World Distribution of Income (estimated from Individual Country Distributions)", mimeo UPF, April 2002. http://www.columbia.edu/~xs23/papers/WorldDistribution.htm
    10. Sala-i-Martin, X. "The Disturbing 'Rise' of World Income Inequality', mimeo UPF April 2002. http://www.columbia.edu/~xs23/papers/GlobalIncomeInequality.htm
    11. Sala-i-Martin, X. "The World Distribution of Income: Falling Poverty and... Convergence, Period!", Quarterly Journal of Economics, April 2006.
    12. PPT
    13. PLAY with Distributions
  2. Distribution of Per Capita Income Across Countries 
    1. Jones, C. I., "On the Evolution of the World Income Distribution", Journal of Economic Perspectives, Summer 1997
    2. Kremer, M., A. Onaski, and J. Stock, "Searching for Prosperity", NBER WP, April 2001.
    3. Quah, D. "Empirics for Growth and Distribution: Polarization, Stratification, and Convergence Clubs", Journal of Economic Growth, 2, 1997.
    4. Quah, D. "Twin Peaks: Growth and Convergence in Models of Distribution Dynamics", Economic Journal, July 1996.
II. The Solow-Swan model.
  1. The Neoclassical Model
    1. BX. Chapter 1.
    2. Easterly, W. "The Elusive Quest for Growth", MIT Press 2002.
      3.
    3. Solow, R., "A Contribution to the Theory of Economic Growth", Quarterly Journal of Econnomics, February, 1956.
    4. Swan, T. W., "Economic Growth and Capital Accumulation", Economic Record, 1956.
  2. Extensions (AK, Harrod-Domar, Poverty Traps)
    1. BX  Chapter 1.
    2. Azariadis, C. and A. Drazen, "Threshold Externalities in Economic Development", Quarterly Journal of Economics, May 1990, pp. 501-26
    3. Galor, O. and J. Zeira, "Income Distribution in Macroeconomics", Review of Economic Studies, 1993, 60, 35-52.
    4. Krugman, P., (1991), "History versus Expectations", Quarterly Journal of Economics, May 1991, vol 106, pp. 651-667.
    5. Matsuyama, K. "Increasing Returns, Industrialization, and Indeterminacy of Equilibrium", Quarterly Journal of Economics, May 1991, vol 106, pp. 617-650.
    6. Murphy, K. A. Shleifer, and R. Vishny, "Industrialization and the Big Push", Journal of Political Economy, vol 97. October 1989, 1003-1002
  3. The Convergence Debate
    1. BX Chapters 10, 11 and 12.
    2. Barro, R. and X. Sala-i-Martin, "Convergence", Journal of Political Economy, April 1992.
    3. Baumol, W., "Productivity Growth, Convergence, and Welfare: What the long run data show", American Economic Review. December 1986.
    4. Caselli, F. G. Esquivel, and F. Lefort, "Reopening the Convergence Debate: A New Look at Cross-Country Growth Empirics", Journal of Economic Growth, September 1996.
    5. Delong, J. B., "Productivity Growth, Convergence, and Welfare: Comment", American Economic Review, December 1988.
    6. Islam, N., "Growth Empirics: A Panel Data Approach", Quarterly Journal of Economics, November 1995.
    7. Mankiw, N.G., D. Romer and D. Weil, "A Contribution to the Empirics of Economic Growth", Quarterly Journal of Economics, May 1992.
    8. Shioji, E., "Still Two Percent Per Year", working paper Universitat Pompeu Fabra, 1998.
III. The Ramsey model.  
  1.  Basic Model 
    1. BX Chapter 2
    2. Cass, D., "Optimum Growth in an Aggregative Model of Capital Accumulation", Review of Economic Studies, July 1965.
    3. Harrod, R. F., "An Essay in Dynamic Theory", The Economic Journal, March 1939.
    4. King, R. and S. Rebelo, "Transitional Dynamics and Economic Growth in the Neoclassical Model", American Economic Review, September 1993.
    5. Koopmans, T. C., "On the Concept of Optimal Growth", in "The Econometric Approach to Development Planning", North Holland, 1965.
    6. Ramsey, F., "A Mathematical Theory of Saving", Economic Journal, 1928.
  1. Taxation and Spending in the Neoclassical Model
    1. Class Notes
  2. Aggregation
    1. Caselli, Francesco and Jaume Ventura, "A Representative Consumer Theory of Distribution", American Economic Review, Vol. 90., number 4, pp. 909-27, September 2000,

IV. One Sector Models of Endogenous Growth.

  1. The AK model
  2. Learning-by-Doing
    1. BX Chapter 4
    2. Easterly, W. "The Elusive Quest for Growth", MIT Press 2002.
      3.
    3. Jones, L., and R. Manuelli, "A Convex Model of Equilibrium Growth", Journal of Political Economy, October 1990.
    4. Rebelo, S., "Long Run Policy Analysis and Long Run Growth", Journal of Political Economy, October 1990.
    5. Romer, P., "Increasing Returns and Long Run Growth", Journal of Political Economy, October 1986.
  3. Scale Effects
    1. Jones, C. I, "R&D Based Models of Economic Growth", Journal of Political Economy, August 1995, vol. 103: (4) 759-784.
    2. Kremer, M. , "Population Growth and Technological Change: One Million B.C. to 1990", Quarterly Journal of Economics, 108, 3 (August), 681-716.
    4.

V. Government and Public Finance.

  1. Public Spending, Public Goods and Goods Subject to Congestion.
  2. Government Spending and Endogenous Growth
  1. BX Chapter 4
  2. Aghion, P., E. Caroli, and C. Garcia-Pe�alosa, "Inequality and Economic Growth: The Perspective of New Growth Theories", Journal of Economic Literature, XXXVII, pp.1615-61, December 1999
  3. BX Chapter 4.
  4. Barro, R.J., "Government Spending in a simple model of Endogenous Growth", Journal of Political Economy , October 1990.
  5. Barro, R.J., "Inequality and Growth in a Panel of Countries", Journal of Economic Growth, 2000.
  6. Barro, R. and X. Sala-i-Martin, �Government Taxation and Growth� (mimeo September 2000).
  7. Barro, R. and X. Sala-i-Martin, "Public Finance in Models of Economic Growth", Review of Economic Studies, October 1992.
  8. Sala-i-Martin, X. "Transfers, Social Safety Nets, and Growth". IMF Staff Papers, vol. 44, No 1, pp.81-102, 1997.
VI. Human Capital.
  1. Irreversibility Constraints
  2. A Human Capital Sector .  Steady-State Analysis . Transitional Dynamics. Graphical Techniques and Numerical Techniques. The Time Elimination Method.
    1. BX Chapter 5
    2. Acemoglu, D. and S. Johnson, (2006), "Disease and Development: The Effect of Life Expectancy on Economic Growth" NBER Working Paper No. 12269, June 2006
    3. Artadi, E. V. (2006), "Going into Labor: Earnings vs. Infant Survival in Rural Africa", mimeo Harvard University
    4. Easterly, W. "The Elusive Quest for Growth", MIT Press 2002.
      5.
    5. Mulligan C. and X. Sala-i-Martin, "Transitional Dynamics in Two-Sector Models of Endogenous Growth", Quarterly Journal of Economics, August 1993.
    6. Caballe, J. and M. Santos, "On endogenous growth and physical capital", Journal of Political Economy, December 1993.
    7. Lucas, R. E., "On the Mechanics of Development", Journal of Monetary Economics, July 1988.
    8. Weil, David N. (2005) �Accounting for the Effect of Health on Growth,� NBER working paper 11455, July.
    9. Young, Alwyn (2005) �The Gift of the Dying: The Tragedy of AIDS and the Welfare of Future African Generations,� Quarterly Journal of Economics, Volume CXX, Issue 2, May, 423-466.

VII. The Economics of Ideas.

  1. The History of Technology
  1. R&D Models of Expanding Varieties
    1. BX Chapter 6
    2. Grossman, G. and Helpman, E., "Innovation and Growth in the World Economy", M.I.T. Press, 1991, Chapters 3 and 4.
    3. Romer, P., "Growth Based on Increasing Returns due to Specialization", American Economic Review, 77: (2) 56-62. May 1987.
    4. Romer, P., "Endogenous Technological Change", Journal of Political Economy, October 1990.
  1. Measuring Productivity Growth: Growth Accounting
    1. BX Chapter 10
    2. Barro, R.J., "Notes on Growth Accounting", Journal of Economic Growth, June 1999.
    3. Hsieh, C. T., "What Explains the Industrial Revolution in Asia: Evidence from Factor Markets", working Paper University of California Berkeley, 1998.
    4. Hsieh, C. "Productivity Growth and Factor Prices in East Asia", American Economic Review, May 1999, pp.133-39.
    5. Hulten, C., "Total Factor Productivity: A Short Biography", NBER Working Paper W7471, January 2000.
    6. Young, A. , "The Tyranny of Numbers: Confronting the Statistical Realities of the East Asian Growth Experience", NBER working Paper, 1994.
    7. Young, A., "Alternative Estimates of Productivity Growth in the NICs: A comment on the Findings of Chang-Tai Hsieh", NBER working paper # 6657, 1998.

       

NOTES: