ECON G6301: ECONOMIC GROWTH AND DEVELOPMENT I

(Second Year Graduate Program [Master and Ph.D.])

Fall 2002

SYLLABUS AND READING LIST

The Basic Text for this course is

Barro R. J. and X. Sala-i-Martin, "Economic Growth", MIT Press, 1998 (BX). Additional Readings are listed for each part of the course.

TENTATIVE (AND DYNAMIC) LIST OF TOPICS AND READINGS

1. Introduction to Growth.
   1.  Growth, Poverty, and Welfare: The World Distribution of Individual Income
      1. Bourguignon, F. and C. Morrisson, C., (2002) , "Inequality Among World Citizens: 1820-1992", forthcoming American Economic Review.
      2. Cowell, F.A., "Measuring Income Inequality", 2^nd Edition, Harvester Wheatsheaf, Hemel Hempstead, 1995.
      3. 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
      4. 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
      5. 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
      6. 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
      7. 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
      8. Sala-i-Martin, X. "The Disturbing 'Rise' of World Income Inequality', mimeo UPF April 2002. http://www.columbia.edu/~xs23/papers/GlobalIncomeInequality.htm
   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.

       

    
2. The Solow-Swan model.
   1. The Neoclassical Model
   1. BX. Chapter 1.
   2. Sala-i-Martin, X. "Notes on an Optimizing Version of the Solow-Swan Model", (mimeo September 2000).
   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, 1003-10026.
   7. Sala-i-Martin, X., "A Note on Models of Poverty Traps" (mimeo September 2000).
   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.

    

3. 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.
   2. Taxation and Spending in the Neoclassical Model
      1. Class Notes
   3. 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,
4.  Open Economies and Capital Mobility
   1. Open Economies. Perfect Capital Mobility. Collateral, Capital Mobility and Growth and Finite Lives
   1. BX. Chapter 3
   2. Barro, R., G. Mankiw and X. Sala-i-Martin, "Capital Mobility in Neoclassical Models of Growth", American Economic Review, March 1995
   3. Duczynski, Petr, "Capital Mobility in Neoclassical Models of Growth: comment", American Economic Review, 2000.
   4. Kremer, M., and James Thomson, "Why Isn't Convergence Instantaneous? Young Workers, Old Workers, and Gradual Adjustment", Journal of Economic Growth, March 1998.
   2. Globalization and Growth: what do the data say?
      1. Dollar, D. and A. Kraay, "Trade, Growth and Poverty", World Bank Working Paper, 2001. http://www.worldbank.org/research/growth/pdfiles/growthgoodforpoor.pdf
      2. Dollar, D. and A. Kraay, "Spreading the Wealth", Foreign Affairs, February 2002. http://www.foreignaffairs.org/articles/Dollar0102.html
      3. Frenkel, J. and D. Romer, "Does Trade Cause Growth", American Economic Review, June 1999, 89(3), 379-399.
      4. Rodrik, D., A. Subramanian, and F. Trebbi, "Institutions Rule: The Primacy of Institutions over Geography and Integration in Economic Development", mimeo Harvard University, October 2002. http://ksghome.harvard.edu/~.drodrik.academic.ksg/institutionsrule,%202.0.pdf

       

5.  One Sector Models of Endogenous Growth.
   1. The AK model
   2. Learning-by-Doing
   1. BX Chapter 4
   2. Jones, L., and R. Manuelli, "A Convex Model of Equilibrium Growth", Journal of Political Economy, October 1990.
   3. Rebelo, S., "Long Run Policy Analysis and Long Run Growth", Journal of Political Economy, October 1990.
   4. 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.

       

6.  Government and Public Finance.
   1. Public Spending, Public Goods and Goods Subject to Congestion.
   2. Government Spending and Endogenous Growth
   3. Social Security and Growth
   4. Property Rights and Social Disruption
   5. Inequality and Growth
   1. Aghion, P., E. Caroli, and C. Garcia-Peñalosa, "Inequality and Economic Growth: The Perspective of New Growth Theories", Journal of Economic Literature, XXXVII, pp.1615-61, December 1999
   2. BX Chapter 4.
   3. Barro, R.J., "Government Spending in a simple model of Endogenous Growth", Journal of Political Economy , October 1990.
   4. Barro, R.J., "Inequality and Growth in a Panel of Countries", Journal of Economic Growth, 2000.
   5. Barro, R. and X. Sala-i-Martin, “Government Taxation and Growth” (mimeo September 2000).
   6. Barro, R. and X. Sala-i-Martin, "Public Finance in Models of Economic Growth", Review of Economic Studies, October 1992.
   7. Sala-i-Martin, X. "Transfers, Social Safety Nets, and Growth". IMF Staff Papers, vol. 44, No 1, pp.81-102, 1997.

    

7. 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. Mulligan C. and X. Sala-i-Martin, "Transitional Dynamics in Two-Sector Models of Endogenous Growth", Quarterly Journal of Economics, August 1993.
      3. Caballe, J. and M. Santos, "On endogenous growth and physical capital", Journal of Political Economy, December 1993.
      4. Lucas, R. E., "On the Mechanics of Development", Journal of Monetary Economics, July 1988.
      5. Galor, O. and O. Moav, "Das Human Capital", mimeo Tel Aviv, 2002, http://econ.pstc.brown.edu/faculty/galor/working.html
   1. Measuring Human Capital
      1. Barro, R.J. and J. W. Lee, "International Comparisons of Educational Attainment", Journal of Monetary Economics, 32: (3) 363-394, December 1993.
      2. Barro, R.J. and J. W. Lee, "International Data on Educational Attainment: Updates and Implications", NBER WP 7911, 2000.
      3. De la Fuente, A. and R. Domenech, "Human Capital in Growth Regressions: How much difference does data quality make", mimeo IAE, July 2002.
      4. Mulligan C. and X. Sala-i-Martin, "A Labor Income-Based Measure of the Aggregate Value of Human Capital", Journal of Japan and the World Economy, 1996
      5. Mulligan C. and X. Sala-i-Martin, "Measuring Human Capital", mimeo Columbia University, August 2000.
      6. Woessman, L. "Specifying Human Capital: A Review, Some Extensions and Development Accounting Results", mimeo Kiel Institute of World Economics, September 2000.

       

8. The Economics of Ideas.
   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.
   2. R&D Without 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. Peretto, P. F. "Technological Change and Population Growth", Journal of Economic Growth, Vol. 3, No. 4, December 1998, pp. 283-311.
   3. Quality Ladders and Neoschumpeterian Economics
      1. BX Chapter 7
      2. Aghion P. and P. Howitt, "A Model of Growth through Creative Destruction" Econometrica, 1992, LX 323-51.
      3. Aghion P. and P. Howitt, "Endogenous Growth", MIT Press, 1998
      4. Grossman, G. and Helpman, E., "Innovation and Growth in the World Economy", M.I.T. Press, 1991, Chapters 3 and 4
      5. Sala-i-Martin, X. "Lecture Notes on a Schumpeterian Model of Technological Innovation", November 2000.
   4. Measuring Productivity Growth: Growth Accounting
      1. Barro, R.J., "Notes on Growth Accounting", Journal of Economic Growth, June 1999.
      2. Hsieh, C. T., "What Explains the Industrial Revolution in Asia: Evidence from Factor Markets", working Paper University of California Berkeley, 1998.
      3. Hsieh, C. "Productivity Growth and Factor Prices in East Asia", American Economic Review, May 1999, pp.133-39.
      4. Hulten, C., "Total Factor Productivity: A Short Biography", NBER Working Paper W7471, January 2000.
      5. Young, A. , "The Tyranny of Numbers: Confronting the Statistical Realities of the East Asian Growth Experience", NBER working Paper, 1994.
      6. Young, A., "Alternative Estimates of Productivity Growth in the NICs: A comment on the Findings of Chang-Tai Hsieh", NBER working paper # 6657, 1998.

       

9. Technological Diffusion.
   1. Theory 
      1. BX Chapter 8.
      2. Acemoglu, Daron and Fabrizio Zilibotti (2001).  “Productivity Differences,” Quarterly Journal of Economics, 116, 563-606.
      3. Barro, R. J. and X. Sala-i-Martin, "Technological Diffusion, Convergence, and Growth", Journal of Economic Growth, Vol. 2, No. 1997.
      4. Kremer, M. “Creating Markets for New Vaccines”, mimeograph MIT, August 2000
      5. Krugman, P. (1979). “A Model of Innovation, Technology Transfer, and the World Distribution of Income,” Journal of Political Economy, 87, 2, 253-66.
   2. Evidence
      1. Caselli, F. and J. Coleman (2001): “Cross-Country Technology Diffusion: The Case of Computers,” AER, may..
      2. Coe, D avid T. and Elhanan Helpman (1995): “International R&D Spillovers,” European Economic Review 39,859-887
      3. Coe, David T., Elhanan Helpman, and Alexander W. Hoffmaister (1997), “North-South R&D Spillovers,” Economic Journal, 107, 134-149.
      4. Jaumotte, Florence (1999). “Technological Catch-up and the Growth Process,” unpublished, Harvard University, November.
      5. Alcala, F. and A. Ciccone (2001): “Trade and Productivity.” CEPR working paper. http://www.cepr.org/pubs/new-dps/dplist.asp?dpno=3095

       

10. The History of the world: Models of Industrial Revolution and Population Change.
    1. BX Chapter 9.
    2. Galor, O. and D. N. Weil, "Population, Technology and Growth: From the Malthusian Regime to the Demographic Transition", NBER Working Paper # 6811, 1998.
    3. Galor, O. and O. Moav, ""Natural Selection and the Origin of economic Growth" mimeo Brown University, 2002. http://econ.pstc.brown.edu/faculty/galor/working.html
    4. Hansen, G. D. and E. C. Prescott, "Malthus to Solow", NBER Working Paper # 6858, 1998.
    5. Jones, C. I., "Was an Industrial Revolution Inevitable? Economic Growth over the Very Long Run", mimeo Stanford University, May 1999.
    6. Kremer, M. , "Population Growth and Technological Change: One Million B.C. to 1990", Quarterly Journal of Economics, 108, 3 (August 1993), 681-716.
    7. Lucas, R. E., "The Industrial Revolution: Past and Future", mimeo University of Chicago, 1999.

     

11. Africa
    1. Tragedies and Successes of a Continent
       1. Acemoglu, D. S. Johnson and J. Robinson, "An African Success Story: Botswana", forthcoming in "Analytical Development Narratives edited by Dani Rodrik, Princeton University Press (2001).
       2. Collier, P. and J. W. Gunning, "Why Has Africa Grown Slowly", Journal of Economic Perspectives, V. 13, Number 3, Summer 1999
       3. Collier, P. and J. W. Gunning, "Explaining African Economic Performance", Journal of Economic Literature, 37:1, pp 64-111, March 1999
       4. Sachs, J. "Tropical Underdevelopment", NBER WP 8119, 2001.
       5. Sala-i-Martin, X. and Subramanian, A., "The Nigerian Disaster", Mimeo Columbia University, September 2002. 
       6. Subramanian, A. and D. Roy "Who Can Explain The Mauritian Miracle: Meade, Romer, Sachs or Rodrik?", IMF Working Paper, June 2001, forthcoming in "Analytical Development Narratives edited by Dani Rodrik, Princeton University Press, 2001.
    2. Ethnic Conflict and Growth
       1. Caselli and Coleman (2002): “On the Theory of Ethnic Conflict.” Unpublished. Harvard.
       2. Easterly, W. and R. Levine, "Africa's Growth Tragedy: Policies and Ethnic Divisions", Quarterly Journal of Economics, CXII pp. 1203-1250, 1997
       3. Maier, Karl (2000), "This House has Fallen: Midnight in Nigeria", Public Affairs, August 2000.
       4. McDermott (1997): “Exploitation and Growth.” Journal of Economic Growth. September.
    3. AIDS and Vaccines
       1. Kremer, M. “Creating Markets for New Vaccines”, mimeograph MIT, Innovation Policy and the Economy, 2001.. http://post.economics.harvard.edu/faculty/kremer/vaccine.html
    4. Lattitude, Institutions and the Determinants of the Wealth of Nations 
       1. Acemoglu, D. S. Johnson and J. Robinson, "The Colonial Origins of Comparative Development: An Empirical Investigation", American Economic Review 91, 1369-1401. http://papers.nber.org/papers/W7771
       2. Acemoglu, D. S. Johnson and J. Robinson, "Reversal of Fortune: Geography and Institutions in the Making of the Modern World Distribution of Income" 2001. Forthcoming Quarterly Journal of Economics, 2002. http://econ-www.mit.edu/faculty/acemoglu/files/papers/qjerffinal1.pdf
       3. Easterly, W. and R. Levine (2002), "Tropics, Germs, and Crops: How Endowments Influence Economic Development", NBER wp 9106, August.
       4. Hall, R. and C. Jones, "Why do some countries produce so much more output than others?" The Quarterly Journal of Economics, vol. 114, no. 1, pp. 83-116, February 1999.
       5. McArthur, J. and J. Sachs, "Institutions and Geography: Comment on Acemoglu, Johnson and Robinson", NBER WP 8114, February 2001. http://papers.nber.org/papers/W8114
    5. Debt Relief and International Aid
       1. Dollar, D. "Aid and Reform in Africa", World Bank, 2001. http://www.worldbank.org/research/aid/africa/intro.htm 
       2. Easterly, W. "The Elusive Quest for Growth", MIT Press 2002.
       3. Wold Bank Policy Report: "Assessing Aid", Oxford University Press, 1998. http://www.worldbank.org/research/aid/aidpub.htm

        

12. The Empirics of Growth.
    1. Data
    1. BX Chapter 10
    2. The Determinants of Growth
       1. BX. Chapter 12
       2. Aghion, P., E. Caroli, and C. Garcia-Peñalosa, "Inequality and Economic Growth: The Perspective of New Growth Theories", Journal of Economic Literature, XXXVII, pp.1615-61, December 1999
       3. Barro, R.J., "Economic Growth in a Cross Section of Countries", Quarterly Journal of Economics, May 1991.
       4. Barro, R.J. "The Determinants of Democracy", Journal of Political Economy, December 1999
       5. Durlauf, S. and D. Quah, "The New Empirics of Economic Growth", NBER Working Paper W6422, February 1998, in Handbook of Macroeconomics, J. Taylor and M. Woodford eds, North Holland, forthcoming, 2002.
       6. Durlauf, S. and D. Quah, "The New Empirics of Economic Growth", NBER Working Paper W6422, February 1998, in Handbook of Macroeconomics, J. Taylor and M. Woodford eds, North Holland, forthcoming, 2002.
       7. McMarthy, F., H. Wolf, and Y. Wu, "The Growth Costs of Malaria", NBER Working Paper 7541, February 2000.
       8. Easterly, W. and R. Levine, "It's Not Factor Accumulation: Stylized Facts and Growth Models", mimeo Policy Research Group, The World Bank, November 1999.
       9. Maddison, A., "Growth and Slowdown in Advanced Capitalist Economies: Techniques of Quantitative Assessment", Journal of Economic Literature, June 1987.
       10. Perotti, R., "Growth, Income Distribution, and Democracy: What the Data Say", Journal of Economic Growth, 1, 2, pp. 149-87, June 1996.
       11. Rodrik, D. "Where did All Growth Go? External Shocks, Social Conflict, and Growth Collapses", Journal of Economic Growth, 4, 4, pp.385-412. December 1999
       12. Sala-i-Martin, X., "I Just Ran Two Million Regressions", American Economic Review, Vol. 87, n.2, pp. 178-183, 1997.
       13. Temple, J., "The New Growth Evidence", Journal of Economic Literature, March 1999, pp. 112-156
    3. The Robustness Debate
       1. Barro, R.J., "Economic Growth in a Cross Section of Countries", Quarterly Journal of Economics, May 1991.
       2. Doppelhoffer, G., R. Miller, and X. Sala-i-Martin,. "Cross-Sectional Growth Regressions: Robustness and Bayesian Model Averaging", forthcoming American Economic Review, 2002.
       3. Levine, R. and D. Renelt, "A Sensitivity Analysis of Cross Country Growth Regressions", American Economic Review, 82: (4) 942-963, September 1992.
       4. Sala-i-Martin, X., "I Just Ran Two Million Regressions", American Economic Review, Vol. 87, n.2, pp. 178-183, 1997.
       5. Temple, J., "The New Growth Evidence", Journal of Economic Literature, March 1999, pp. 112-156.

     

 



REQUIREMENTS

• There will be one final examination at the end of the semester.
• Students may opt out of  the exam by writing a paper. The students who opt for the paper should say so to the professor by October 15th. A first draft of the paper should be written by  the end of classes. The final version is due by January 20, 2002. 



OTHER INFORMATION

• Office Hours: Mondays 3:00pm to 5:00pm
• Office: Department of Economics (International Affairs Building), Room 1005
• Phone: 1 212 854 7055
• Secretary: Sharon Wynne (Department of Economics, 10th Floor)
• e-mail: xs23@columbia.edu
• Sign up for this Course and get more information in my home page: http://www.columbia.edu/~xs23/