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EC569 Economic Growth

Spring 2019/20

Module Convener: Ilhan Guner

Room: Kennedy 119

Email: [email protected]

Consultation Hours: Mondays & Wednesdays 10:00-11:00

Main Textbooks:

• Weil, D., 2013, Economic Growth, 3rd ed., Pearson.
• Jones, C. and D. Vollrath, 2013, Introduction to Economic Growth, 3rd ed., W.W. Norton.

Other Resources:

• CORE The Economy: Economics for a Changing World. Oxford University Press, First Edition, 2017, ISBN 9780198810247.
• https://ourworldindata.org : A thoughtful collection of essays on changing living conditions around the world, supplemented with striking visualization of recent data.
• Rosling, H., Rosling, O., & Rönnlund, A. R. (2018). Factfulness: Ten Reasons We're Wrong about the World--and why Things are Better Than You Think. St Martin's Press.
• Economical Writing by Deirdre N. McCloskey
• The Book of Why: The New Science of Cause and Effect by Judea Pearl and Dana Mackenzie
• https://voxeu.org : VOX  CEPR Policy Portal, “Research-based policy analysis and commentary from leading economists”. Here, economists write about their research in an accessible style.
• https://growthecon.com/blog/ : Blog of Dietrich Vollrath.
• https://gunerilhan.github.io/teaching/ : My personal webpage where I post module related material.

LECTURE SCHEDULE AND SUGGESTED READINGS

Introduction

• Chapters 1, 2 (Weil)
• Chapter 1 (Jones and Vollrath)
• Amartya Sen, Quality of Life: India vs. China, NYRB, 21 May 2011
• Kevin Bryan, “How we create and destroy growth: The 2018 Nobel laureates”, VOX 11 October 2018
• Paul M. Romer, Economic Growth, The Library of Economics and Liberty

The Solow model

• The basic Solow model
• Chapter 2.1 (Jones and Vollrath)
• Physical capital
• Chapter 3 (Weil)
• Population
• Chapter 4 (Weil)
• Human capital
• Chapter 6 (Weil)
• Chapter 3.1 (Jones and Vollrath)
• Convergence of countries
• Chapter 3.2 (Jones and Vollrath)
• The Solow model with technology
• Chapter 2.2 (Jones and Vollrath)

Productivity

• Chapter 7 (Weil)
• Chapter 2.4 (Jones and Vollrath)

Technology and Efficiency

• Chapters 8, 9 (Weil)
• Chapter 4 (Jones and Vollrath)
• Chapter 10 (Weil)
• Bloom, N., Sadun, R., & Van Reenen, J. (2016). Management as a Technology? (No. w22327). National Bureau of Economic Research.
• Nicholas Bloom, Erik Brynjolfsson, Lucia Foster, Ron Jarmin, Megha Patnaik, Itay Saporta Eksten, John Van Reenen, “Adding a piece to the productivity puzzle: Management practices”, VOX 17 May 2017
• Bloom, N., Jones, C. I., Van Reenen, J., & Webb, M. (2017). Are ideas getting harder to find? (No. w23782). National Bureau of Economic Research.
• Nicholas Bloom, Chad Jones, John Van Reenen, Michael Webb, “Ideas aren’t running out, but they are getting more expensive to find”, VOX 20 September 2017

Openness

• Chapters 11, 8.3 (Weil)

Inequality

• Chapter 13 (Weil)
• Unit 19 (Core The Economy)

Government

• Chapter 12 (Weil)
• Hausmann, R., Rodrik, D., & Velasco, A. (2008). Growth diagnostics. The Washington consensus reconsidered: Towards a new global governance, 324-355.
• Juhász, R. (2018). Temporary protection and technology adoption: Evidence from the napoleonic blockade. American Economic Review, 108(11), 3339-76.
• Philip P. Pan, “The Land That Failed to Fail”, New York Times 18 November 2018

Environment

• Chapter 16 (Weil)
• Unit 20 (Core The Economy )
• Kenneth Gillingham, “William Nordhaus and the costs of climate change”, VOX 19 October 2018
• Anderson, Soren T. and Marinescu, Ioana Elena and Shor, Boris, Can Pigou at the Polls Stop US Melting the Poles? (July 31, 2019).

SEMINAR SCHEDULE AND READINGS

Papers with (*) will be discussed in the seminars and part of the exam material. Others are suggestive readings.

Seminar 1: Human Capital

• Barro, Robert, Human Capital and Growth, American Economic Review, 91 (2), 2001, pp.12-17
• *Hanushek, E. A., & Woessmann, L. (2008). The role of cognitive skills in economic development. Journal of economic literature, 46(3), 607-68.

Seminar 2: Convergence

• *Dietrich Vollrath, “New evidence on convergence”, Growth Econ November 2, 2018
• *Dev Patel, Justin Sandefur and Arvind Subramanian, “Everything You Know about Cross-Country Convergence Is (Now) Wrong”, Center for Global Development October 15 2018.
• Johnson, Paul, Papageorgiou, Chris (Forthcoming). What Remains of Cross-Country Convergence?, Journal of Economic Literature

Seminar 3: Growth Accounting

• Young, Alwyn, The Tyranny of Numbers: Confronting the Statistical Realities of the East Asia Growth Experience, Quarterly Journal of Economics, 110 (3), 1995, pp.641-680
• Paul Krugman, “The Myth of Asia’s Miracle,” Foreign Affairs, Nov/Dec 1994.
• *Zhu, X. (2012). Understanding China's growth: Past, present, and future. Journal of Economic Perspectives, 26(4), 103-24.

Seminar 4: Technology adoption

• Neil Irwin, “What Was the Greatest Era for Innovation? A Brief Guided Tour”, New York Times, May 13, 2016
• *Chad Jones, “New ideas about new ideas: Paul Romer, Nobel laureate” VOX, 12 October 2018
• *Bloom, N., Van Reenen, J., & Williams, H. (2019). A toolkit of policies to promote innovation. Journal of Economic Perspectives, 33(3), 163-84.

Seminar 5: Capital flows and financial development:

• *Kose, Ayhan, Eswar Prasad and Marco Terrones, Does openness to international financial flows raise productivity growth? 2009, Journal of International Money and Finance, 28, pp.554-580.
• Beck, Thorsten, Ross Levine and Norman Loayza, Finance and the sources of growth, Journal of Financial Economics, 58 (1-2), 2000, pp.261-300.

Seminar 6: Income distribution

• *Dollar, David and Aart Kraay, Growth is Good for the Poor, Journal of Economic Growth, 7 (3), 2002, pp.195-225.
• Branko Milanovic, “Why inequality matters?”, VOX 20 December 2018
• Branko Milanovic, “The Inequality Paradox: Rising Inequalities Nationally, Diminishing Inequality Worldwide”, ProMarket 10 December 2018

References

1. Barro, Robert, Human Capital and Growth, American Economic Review, 91 (2), 2001, pp.12-17
2. Beck, Thorsten, Ross Levine and Norman Loayza, Finance and the sources of growth, Journal of Financial Economics, 58 (1-2), 2000, pp.261-300.
3. *Bloom, N., Van Reenen, J., & Williams, H. (2019). A toolkit of policies to promote innovation. Journal of Economic Perspectives, 33(3), 163-84.
4. Bloom, N., Sadun, R., & Van Reenen, J. (2016). Management as a Technology? (No. w22327). National Bureau of Economic Research.
5. Nicholas Bloom, Erik Brynjolfsson, Lucia Foster, Ron Jarmin, Megha Patnaik, Itay Saporta Eksten, John Van Reenen, “Adding a piece to the productivity puzzle: Management practices”, VOX 17 May 2017
6. *Bloom, N., Jones, C. I., Van Reenen, J., & Webb, M. (2017). Are ideas getting harder to find? (No. w23782). National Bureau of Economic Research.

• Nicholas Bloom, Chad Jones, John Van Reenen, Michael Webb, “Ideas aren’t running out, but they are getting more expensive to find”, VOX 20 September 2017

7. *Dev Patel, Justin Sandefur and Arvind Subramanian, “Everything You Know about Cross-Country Convergence Is (Now) Wrong”, Center for Global Development October 15 2018.
8. *Dollar, David and Aart Kraay, Growth is Good for the Poor, Journal of Economic Growth, 7 (3), 2002, pp.195-225.
9. Kenneth Gillingham, “William Nordhaus and the costs of climate change”, VOX 19 October 2018
10. *Hanushek, E. A., & Woessmann, L. (2008). The role of cognitive skills in economic development. Journal of economic literature, 46(3), 607-68.
11. Hausmann, R., Rodrik, D., & Velasco, A. (2008). Growth diagnostics. The Washington consensus reconsidered: Towards a new global governance, 324-355.
12. Neil Irwin, “What Was the Greatest Era for Innovation? A Brief Guided Tour”, New York Times, May 13, 2016
13. Johnson, Paul, Papageorgiou, Chris (Forthcoming). What Remains of Cross-Country Convergence?, Journal of Economic Literature
14. *Chad Jones, “New ideas about new ideas: Paul Romer, Nobel laureate” VOX, 12 October 2018
15. Juhász, R. (2018). Temporary protection and technology adoption: Evidence from the napoleonic blockade. American Economic Review, 108(11), 3339-76.
16. *Kose, Ayhan, Eswar Prasad and Marco Terrones, Does openness to international financial flows raise productivity growth? 2009, Journal of International Money and Finance, 28, pp.554-580.
17. Paul Krugman, “The Myth of Asia’s Miracle,” Foreign Affairs, Nov/Dec 1994.
18. Branko Milanovic, “Why inequality matters?”, VOX 20 December 2018
19. Branko Milanovic, “The Inequality Paradox: Rising Inequalities Nationally, Diminishing Inequality Worldwide”, ProMarket 10 December 2018
20. Philip P. Pan, “The Land That Failed to Fail”, New York Times 18 November 2018
21. Parente, Stephen and Edward Prescott, Barriers to Technology Adoption and Development, Journal of Political Economy, 102 (2), 1994, pp.298-321
22. Paul M. Romer, Economic Growth, The Library of Economics and Liberty
23. Amartya Sen, Quality of Life: India vs. China, NYRB, 21 May 2011
24. Young, Alwyn, The Tyranny of Numbers: Confronting the Statistical Realities of the East Asia Growth Experience, Quarterly Journal of Economics, 110 (3), 1995, pp.641-680
25. *Zhu, X. (2012). Understanding China's growth: Past, present, and future. Journal of Economic Perspectives, 26(4), 103-24.
26. *Dietrich Vollrath, “New evidence on convergence”, Growth Econ November 2, 2018