Exorbitant Privilege: The Rise and Fall of the Dollar and ... Syllabi.pdf · Research paper: prospectus due Tuesday February 14; oral presentation to be scheduled during . March;

ECONOMICS 1710W Spring 2012, Course Number 25229 Pro-seminar in International Economics

http://courseweb.pitt.edu Tuesday/Thursday 2:30-3:45, CL 314

Instructor: T.G. Rawski, Department of Economics, 4526 WWPH, telephone 648-7062, email [email protected], web address www.pitt.edu/~tgrawski. Office hours: Wednesday: 2-3:30. Course Description: This seminar will focus on three subjects: intensive discussion of seminal papers, many by Nobel laureates, that address fundamental issues in economics; analysis of important global economic issues; and student research projects. Course requirements:

Regular attendance and participation in class sessions. Occasional brief writing assignments. Two short papers due Tuesday January 31 and Thursday March 1 Research paper: prospectus due Tuesday February 14; oral presentation to be scheduled during

March; draft version due Tuesday March 27; final version due Thursday April 19. Reading assignments: include several items available at the University Bookstore as well as materials available on the course website http://courseweb.pitt.edu (marked BBB), through the University library’s web site - marked JJJ – note that back issues (more than five years old) of many journals can be accessed through JSTOR – see http://www.library.pitt.edu/articles/database_info/jstor.html Also see the University Library’s collection of electronic journals: http://rt4rf9qn2y.search.serialssolutions.com/ Books ordered for this course: Barry Eichengreen, Exorbitant Privilege: The Rise and Fall of the Dollar and the Future of the

International Monetary System George Akerlof and Robert Shiller, Animal Spirits : how human psychology drives the economy… Deirdre McCloskey, Economical Writing W. Strunk and E.B. White, The Elements of Style [online at http://www.bartleby.com/141/ ] Andrea A. Lunsford, EASY WRITER 4th edition.

and supplementary books and articles on reserve at Hillman Library (marked HHH), on courseweb (marked BBB) and/or on the internet (WWW). These materials are not designed as textbooks. Some include advanced topics and complex methods that you cannot be expected to master for this course. When you encounter difficult passages, you should (1) try to get the MAIN IDEAS even if you cannot follow all the details; (2) don't hesitate to raise questions in class such as "what does this author mean when by talking about yyy?" or "please explain the importance of zzz." This course will focus on issues that are very much in the news. In order to broaden and deepen your acquaintance with these matters, you should follow current international economic developments by reading the print or on-line versions of publications like the Economist (weekly) or New York Times, Wall Street Journal, and/or Financial Times (daily). A vast range of information and opinion is available via internet, including web sites maintained by governments, international organizations: e.g.

http://courseweb.pitt.edu/

mailto:[email protected]


http://www.library.pitt.edu/articles/database_info/jstor.html

http://rt4rf9qn2y.search.serialssolutions.com/

http://www.oup.com/us/catalog/general/subject/Economics/International/?view=usa&ci=9780199753789

http://pittcat.pitt.edu/cgi-bin/Pwebrecon.cgi?SC=Author&SEQ=20091008192823&PID=Yl8dojDIj9pwTTMno4Ta2HuZ3RE&SA=Akerlof,+George+A.,+1940-

http://pittcat.pitt.edu/cgi-bin/Pwebrecon.cgi?SC=Author&SEQ=20091008192823&PID=Yl8dojDIj9pwTTMno4Ta2HuZ3RE&SA=Shiller,+Robert+J.

http://www.bartleby.com/141/

Economics 1710, Spring 2012, p. 2

http://www.worldbank.org and by individual writers, for instance:

Jagdish Bhagwati: http://www.columbia.edu/~jb38/

Bradford DeLong: http://delong.typepad.com/main/best_work_cv.html

William Easterly: http://www.nyu.edu/fas/institute/dri/Easterly/Research.html Nouriel Roubini: http://www.roubini.com

Paul Krugman: http://web.mit.edu/krugman/www/ ; also see www.pkarchive.org

Dani Rodrik: http://ksghome.harvard.edu/~.drodrik.academic.ksg/papers.html

Joseph Stiglitz: http://www-1.gsb.columbia.edu/faculty/jstiglitz/papers.cfm

WRITING ASSIGNMENTS - all PRINTED AND DOUBLE-SPACED Due January 10, 12, 17. Two page summary papers on each of THREE topics associated with the recent financial crisis and resulting recession. You may (but need not) select themes from the list of selected topics which appears at the end of this document. Due January 19. One paragraph in which you express strong opinions (on any subject) and persuade the reader to share your view. Feeling ambitious? Write a draft version of an op-ed submission instead. Due January 31. 5-10 pages: critical analysis and review of the Eichengreen and Akerloff-Shiller books. Due February 14. Prospectus for research paper. What’s the subject? What will you try to show or discover? What materials and methods will you use? What difficulties do you expect to encounter? Due March 1. 5-10 pages on any topic relevant to the subjects covered in this course. Please avoid duplicating materials from your research project. Due March 27. Draft version of research paper. Due April 19. Final version of research paper. Writing guides. In addition to McCloskey, and Strunk & White, students are invited to consult books on writing. There are also web sources, including: “Writing Economics: A Guide for Harvard’s Sophomore Economics Concentrators” (BBB) U. of Wisconsin Writer’s Handbook http://www.wisc.edu/writing/Handbook/CommonErrors.html#frag American Heritage Book of English Usage http://www.bartleby.com/64/2.html etc.

http://www.worldbank.org/

http://www.columbia.edu/~jb38/

http://delong.typepad.com/main/best_work_cv.html

http://www.nyu.edu/fas/institute/dri/Easterly/Research.html

http://www.roubini.com/

http://web.mit.edu/krugman/www/

http://www.pkarchive.org/

http://ksghome.harvard.edu/~.drodrik.academic.ksg/papers.html

http://www-1.gsb.columbia.edu/faculty/jstiglitz/papers.cfm

http://www.wisc.edu/writing/Handbook/CommonErrors.html#frag

http://www.bartleby.com/64/2.html


Warning about PLAGIARISM. Scholarship builds on words and ideas. Individual authors can legitimately use the words and ideas of others, but only with proper acknowledgment. Copying or paraphrasing someone else’s words without proper attribution is plagiarism. Faculty members are immersed in the world of ideas. They respond to plagiarism, which they regard as theft of ideas, in exactly the same manner as merchants respond to shoplifting. Plagiarism attracts heavy penalties. Offenders receive little sympathy from university faculty, including the instructor in this course. University students should have a clear understanding of the distinction between appropriate citation of other people’s works and forbidden acts of copying or paraphrasing. Any student who feels uncertain about these matters should conduct a web search or ask for clarification. For example, The University of California at Davis offers the following summary: WHAT IS PLAGIARISM? Plagiarism means using another's work without giving credit. You must put others' words in quotation marks and cite your source(s) and must give citations when using others' ideas, even if those ideas are paraphrased in your own words. "Work" includes "original ideas, strategies, and research,"1 art, graphics, computer programs, music, and other creative expression. The work may consist of writing, charts, pictures, graphs, diagrams, data, websites, or other communication or recording media http://www.indiana.edu/~wts/wts/plagiarism.html provides another explanation. http://webster.commnet.edu/mla/index.shtml contains an online guide for writing research papers, including a section on plagiarism. Excerpt from a recent message from your instructor to a student in another course: “I assigned a zero grade to your research paper after discovering that substantial portions of the text, citations, and references replicated (or, in some instances, paraphrased) material from the following sources. . . ” Standard response to discovery of plagiarism: FAILING GRADE FOR THE COURSE NY Times reporter Trip Gabriel writes that “Plagiarism Lines Blur for Students in Digital Age” Take a look: http://www.nytimes.com/2010/08/02/education/02cheat.html Remember that the “plagiarism line” is clear and bright for your instructor; students who cross this line will encounter neither sympathy nor leniency.

http://www.indiana.edu/~wts/wts/plagiarism.html

http://webster.commnet.edu/mla/index.shtml

http://www.nytimes.com/2010/08/02/education/02cheat.html


ECON 1710, Spring 2012 SCHEDULE Date Session Topic Jan. 5 1 Introduction Jan. 10-12-17 2-3-4 The Global Economy – recent financial crisis and current recession; Euro-mess; comparison with 1997/98; can we expect future crises? Jan 19-24 5-6 Basic International Economics Jan 26 NO CLASS Jan 31-Feb. 2 7-8 Government and the Economy Feb. 7-9 9-10 Economic Foundations: Information Feb. 14-16 11-12 Economic Foundations: Institutions Feb. 21-23 13-14 Economic Foundations: Innovation Feb. 28-Mar.1 15-16 Election warm-up: discuss current state of the U.S. economy Mar. 13-22 17-20 Student research presentations Mar. 27 21 Development economics: what is “development”? What are the big issues? Mar. 29 22 China’s economy: what’s the story? How does it affect us? April 3-5 23 Economics and the environment April 10-12 24-25 Economics and health care April 17-19 26-27 Personal finance – using economic thinking to build financial security


Readings January 10-12-17 The Recent Global Macroeconomic Crisis and Ongoing Recession Current Financial Crisis and Recession Economist Team, “How to Grow” special report on the world economy, October 2010 Simon Cox, “The Long Climb: A special report on the world economy” Economist special report, October 1, 2009 (BBB) Zanny Minton Beddoes, “When fortune frowned – special report on the world economy” --- Economist, October 11, 2008 (BBB). [For comparison, you may wish to check her earlier report: “The great thrift shift” --- Economist Special Issue On The World Economy, Sep 22nd 2005 (BBB)] Joseph Stiglitz (Nobel laureate), “The Financial Crisis of 2007-2008 and its Macroeconomic Consequences,” in Time for a Visible Hand: Lessons from the 2008 World Financial Crisis, S. Griffith-Jones, J.A. Ocampo, and J.E. Stiglitz, eds., Initiative for Policy Dialogue Series, Oxford: Oxford University Press, 2010, pp. 19-49 (BBB) Richard Koo slide presentation on “Balance Sheet Recession” See http://www.scribd.com/doc/13970982/Richard-Koo-Presentation Paul Krugman (Nobel laureate), 2 items – "Balance Sheets, the transfer problem and financial crises" (BBB) "Thinking About the Liquidity Trap" (BBB) Asian Financial Crisis of 1997-98 Giancarlo Corsettia, Paolo Pesentib, and Nouriel Roubini, “What caused the Asian currency and Financial crisis?” Japan and the World Economy 11 (1999) 305-373. BBB Joseph Stiglitz (Nobel laureate), “What I learned at the world economic crisis” http://vuzit.com/view/d3q To pursue this topic further, start with http://en.wikipedia.org/wiki/Asian_crisis Long Term Issues Karl Marx and Friedrich Engels, The Communist Manifesto.

http://www2.gsb.columbia.edu/faculty/jstiglitz/download/papers/2010_Financial_Crisis.pdf


http://www.scribd.com/doc/13970982/Richard-Koo-Presentation

http://vuzit.com/view/d3q

http://en.wikipedia.org/wiki/Asian_crisis


Jan. 19-24 Basic International Economics P. Krugman, “Is Free Trade Passe?” Journal of Economic Perspectives 1.2 (1987): 131-144. (BBB) [also of interest, Krugman’s “Narrow and Broad Arguments for Free Trade” BBB] Paul Romer, “Object Gaps and Idea Gaps in Economic Development,” Journal of Monetary Economics 32 (1993): 543-573 (BBB). David Ricardo, Principles of Political Economy and Taxation,” (1821), Chap. 31, “On Machinery” See http://phare.univ-paris1.fr/textes/Ricardo/Principles/prin3.txt; on reserve HHH Paul Samuelson (Nobel laureate), “Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization, J. of Economic Perspectives, 2004. BBB [also of interest: Raymond Vernon, “ International Trade and the Product Cycle” BBB] Jan. 31-Feb 2 Government and the Economy “Taming Leviathan” John Micklethwait, Economist special report Mar 17 2011 The Future of the State Bill Emmott, Economist Survey: "Capitalism and Democracy - Radical Birthday Thoughts," 6-26-2003 BBB Anne Krueger, “The Political Economy of the Rent-Seeking Society,” American Economic Review, 64.3 (1974): 291-303. (BBB) Jeff Madrick, “Less Government Better for Business? Not if History Provides a Guide,” NYTimes Jan. 20, 2005. BBB World Bank WDR Investment Climate Summary BBB Feb. 7-9 Economics and Information George J. Stigler (Nobel Laureate), “The Economics of Information,“ Journal of Political Economy, vol. 69 (1961): 213-225. Reprinted in Stigler, The Organization of Industry. BBB George Akerlof (Nobel Laureate), “The Market for ‘Lemons’ – Quality Uncertainty and the Market Mechanism,” Quarterly Journal of Economics, 84.3 (1970): 488-500. BBB Joseph E. Stiglitz (Nobel Laureate), “Information and Economic Analysis: A Perspective,“ Economic Journal, Vol. 95, Supplement: Conference Papers. (1985), pp. 21-41. BBB. Note: this is VERY difficult – try to grasp the main ideas – don’t be surprised if you cannot follow the entire discussion.

http://phare.univ-paris1.fr/textes/Ricardo/Principles/prin3.txt


Feb. 14-16 Economic Institutions Douglass North (Nobel Laureate), “Economic Performance Through Time,” American Economic Review 84.3 (1994): 359-368. BBB See also Alexander Field review of North, Understanding the Process of Economic Change (BBB) Herbert Simon (Pittsburgh-based Nobel Laureate from CMU), "Organizations and Markets," Journal of Economic Perspectives, Vol. 5 (2), 1991, pp. 25-44. BBB D. Acemoglu et al, “The Colonial Origins of Comparative Development: An Empirical Investigation,” American Economic Review, Dec. 2001. BBB. Ronald Coase (Nobel Laureate), “The Problem of Social Cost,” Journal of Law and Economics 3 (1960). Reprinted in Ronald Coase, The Firm, The Market, and the Law. BBB World Development Report 2002: Building Institutions for Markets. Read Chapter 1: see http://www.rrojasdatabank.info/wdr02/ch1.pdf Feb. 21-23 Innovation Joseph A. Schumpeter, Capitalism, Socialism, and Democracy (1942), Chap. 7 “The Process of Creative Destruction,” pp. 81-86. Reviews and discussion available at http://books.google.com/books?id=6eM6YrMj46sC&dq=schumpeter+capitalism+socialism+and+democracy&printsec=frontcover&source=bn&hl=en&ei=ymZDS7nyHIfJlAfe3p2mBw&sa=X&oi=book_result&ct=result&resnum=4&ved=0CCAQ6AEwAw#v=onepage&q=&f=false Zvi Griliches, "Research Costs and Social Returns: Hybrid Corn and Related Innovations," Journal of

Political Economy 66.5 (1958): 419-431. BBB William Nordhaus, 2 items:

“Do Real-Output and Real-Wage Measures Capture Reality? The History of Lighting Suggests Not.” 1997 working paper. BBB

“The Progress of Computing” (2001 working paper). BBB Feb. 28-March 1 What is the Current State of the U.S. Economy? Greg Ip, “Time to Rebalance: A Special Report on America’s Economy,” Economist, 3 April 2010.

http://ideas.repec.org/a/aea/jecper/v5y1991i2p25-44.html

http://ideas.repec.org/s/aea/jecper.html


http://www.rrojasdatabank.info/wdr02/ch1.pdf

http://books.google.com/books?id=6eM6YrMj46sC&dq=schumpeter+capitalism+socialism+and+democracy&printsec=frontcover&source=bn&hl=en&ei=ymZDS7nyHIfJlAfe3p2mBw&sa=X&oi=book_result&ct=result&resnum=4&ved=0CCAQ6AEwAw#v=onepage&q=&f=false




March 27 Development Brief overview of national income accounting: see major introductory texts (e.g. by Stiglitz, Samuelson-Nordhaus, etc.) or http://en.wikipedia.org/wiki/Gross_national_product#Gross_National_Product The point: how to systematically characterize the difference between rich and poor nations. What is “purchasing power parity” (PPP)? See the International Comparison Project (ICP): http://web.worldbank.org/WBSITE/EXTERNAL/DATASTATISTICS/ICPEXT/0,,menuPK:1973757~pagePK:62002243~piPK:62002387~theSitePK:270065,00.html John O’Sullivan, “A Game of Catch-up.” Economist special report on the world economy, Sept. 2011 (BBB). Joseph Stiglitz (Nobel laureate), The World Development Report: Development Theory and Policy, in Development Economics Through the Decades: A Critical Look at 30 Years of the World Development Report, by Shahid Yusuf, Washington, DC: World Bank, 2008, p. 139-151. (BBB) Look at materials from “Copenhagen Consensus,” a project intended to produce careful economic evaluations of proposed development initiatives:

For Final Summary of the initial phase, see Courseweb BBB - this summary ranks proposed projects in terms of their anticipated benefits. For more, see the project’s web site: http://www.copenhagenconsensus.com/Default.aspx Project papers on a variety of subjects: nutrition, trade barriers, sanitation, climate change, etc., appear at the following address: http://www.copenhagenconsensus.com/Default.aspx?ID=186

David Dollar and Aart Kraay, "Trade, Growth, and Poverty," The Economic Journal, 114 (February), F22–F49. BBB March 29. China’s Economy Loren Brandt and T. Rawski, China’s Great Economic Transformation, chapter1: “China’s Great

Economic Transformation.” (BBB) [book is on reserve under Econ 1630; book also available as an e-book via Pittcat]

James Miles, “Rising Power, Anxious State” survey of China, Economist, 23 June 2011 BBB T. Rawski, “Human Resources and China’s Long Economic Boom” BBB

http://en.wikipedia.org/wiki/Gross_national_product#Gross_National_Product

http://web.worldbank.org/WBSITE/EXTERNAL/DATASTATISTICS/ICPEXT/0,,menuPK:1973757~pagePK:62002243~piPK:62002387~theSitePK:270065,00.html


http://www2.gsb.columbia.edu/faculty/jstiglitz/download/papers/2008_WDR_Dev_Theory_Policy.pdf

http://www.copenhagenconsensus.com/Default.aspx

http://www.copenhagenconsensus.com/Default.aspx?ID=186


April 3-5 Economics and the Environment Garrett Hardin, “The Tragedy of the Commons,” Classic 1968 article available via http://www.dieoff.org/page95.htm Emma Duncan, “Getting Warmer: A special report on climate change and the carbon economy, Economist, December 2009. (BBB)

David Victor et al, “The Geoengineering Option: A Last Resort Against Global Warming?” Foreign Affairs March-April 2009 (BBB).

Journal of Economic Perspectives 23.2 (Spring 2009) symposium on Climate Change – articles by Metcalf, Tol, and Barrett (BBB) Here’s a site for global warming skeptics: http://www.globalwarming.org/ April 10-12 Health Care V. Vaitheeswaran, Economist survey on Health Care and Technology 2010. BBB Overview of health economics: http://en.wikipedia.org/wiki/Health_economics Is American Health Care Uniquely Inefficient? Alan M Garber, Jonathan Skinner Journal of Economic Perspectives. Nov 2008, Vol. 22, No. 4: Pages 27-50 (access via Pittcat electric journals). Economic perspective on President Obama’s 2009 proposals November 2009 Letter from health economists to President Obama http://www.huffingtonpost.com/2009/11/17/economists-tout-health-ca_n_361469.html April 17-19. Personal Finance Philip Coggan, “Repent at Leisure: A Special Report on Debt” Economist, 24 June 2010. (BBB) Philip Coggan, “Falling Short” – special report on pensions, 2011.

http://www.dieoff.org/page95.htm

http://www.globalwarming.org/

http://en.wikipedia.org/wiki/Health_economics

http://www.huffingtonpost.com/2009/11/17/economists-tout-health-ca_n_361469.html


Grading rubric for written work (prepared by Department of History)

A B C D Arguments/ Analysis

Responds to assignment comprehensively and carefully. Selects and synthesizes ideas and information from full range of assigned readings.

Responds to all parts of the assignment, using ideas and information from assigned readings.

Only responds to part of the assignment, fails to answer a central question; ignores important information from assigned readings.

Fails to respond to the assignment; answers few or none of the questions provided

Supporting Evidence

Carefully selects the most significant and relevant supporting evidence to back up claims; explains clearly how each quote or paraphrase relates to an argument or claim

Provides specific supporting evidence from assigned readings; in most cases explains how quotes and paraphrases relate to arguments or claims.

Little concrete evidence presented; fails to explain how quotes or paraphrases relate to arguments or claims; information drawn from readings is partially incorrect.

No supporting evidence is presented; no quotes or paraphrases appear; information drawn from readings is careless and incorrect.

Structure Order of exposition is logical and clear.

Order of exposition is easy to follow.

Poorly organized; relationship between various elements of essay is unclear.

No organizing structure. Repetitious and confusing.

Language/ Mechanics

Clear, vivid, specific, precise vocabulary. No typos or spelling errors. Appropriate mix of quotes and paraphrases.

Grammar correct; vocabulary and phrasing clear. A few typos or spelling errors.

Vague, informal, or erroneous language; excessively wordy; grammatical errors. Multiple typos or spelling errors.

Informal language; multiple grammar and spelling errors. No evidence of proofreading.


Economics 1710: Suggested topics for “Two Page Summary” papers Global Financial Crisis and Recession of 2008-??? Countries/Regions Australia China France Germany Greece Iceland Ireland Italy Japan Latin America Russia Spain United Kingdom New trends Securitization Shadow banking system Hedge funds Mortgage-backed securities Auction rate notes Credit default swaps Companies AIG Bank of America Bear Sterns General Motors Goldman Sachs Lehman Brothers Merrill-Lynch MF Global Standard and Poor Official agencies European Central Bank (ECB) European Community Federal Deposit Insurance Corporation Federal Reserve Fannie Mae/Freddie Mac FDIC Securities and Exchange Commission Individuals Sheila Bair Ben Bernanke Warren Buffet Paul Krugman

Bernie Madoff Angela Merkel Henry Paulson Elizabeth Warren Regulatory Issues Short selling Taylor Rule Excess liquidity vs. inadequate regulation Too big to fail Asian Financial Crisis of 1997-98 Overview China Indonesia Korea Role of IMF Thailand Policy issues Did Congress contribute to the crisis? Why does U.S. unemployment remain high? Was the U.S, stimulus well crafted? Does the financial reform legislation

address the causes of the financial crisis? Does the reform legislation remove or ameliorate systemic conflicts of interest? Does the US face a looming fiscal crisis? Is inflation likely? What is deflation? Is it likely? Will the US dollar decline sharply? Does China’s rise threaten U.S. jobs?




Regular attendance and participation in class sessions. Occasional brief writing assignments. Two short papers due Thursday January 31 and Thursday March 7 Research paper: prospectus due Tuesday February 19; oral presentation to be scheduled during

March; draft version due Tuesday April 2; final version due Thursday April 18. Reading assignments: include several items available at the University Bookstore as well as materials available on the course website http://courseweb.pitt.edu (marked BBB), on reserve at Hillman ground floor (HH) through the University library’s web site - marked JJJ – note that back issues of many journals can be accessed through JSTOR – see http://www.library.pitt.edu/articles/database_info/jstor.html Also see the University Library’s collection of electronic journals: http://rt4rf9qn2y.search.serialssolutions.com/ Books ordered for this course: Barry Eichengreen, Exorbitant Privilege: The Rise and Fall of the Dollar and the Future of the

International Monetary System Luigi Zingales, A Capitalism for the people: Recapturing the Lost Genius of American Prosperity Deirdre McCloskey, Economical Writing Andrea A. Lunsford, EASY WRITER 4th edition. W. Strunk and E.B. White, The Elements of Style [online at http://www.bartleby.com/141/ ]







http://www.oup.com/us/catalog/general/subject/Economics/International/?view=usa&ci=9780199753789










WRITING ASSIGNMENTS - PRINTED AND DOUBLE-SPACED Due January 10, 15, 17. Two page summary papers on each of THREE topics associated with the recent financial crisis and resulting recession. You may (but need not) select themes from the list of selected topics which appears at the end of this document. Due January 22. One paragraph in which you express strong opinions (on any subject) and persuade the reader to share your view. Feeling ambitious? Write a draft version of an op-ed submission instead. Due January 31. 5-10 pages: critical analysis and review of the Eichengreen and Zingales books. Due February 19. Prospectus for research paper. What’s the subject? What will you try to show or discover? What materials and methods will you use? What difficulties do you expect to encounter? Due March 7. 5-10 pages on any topic relevant to the subjects covered in this course. Please avoid duplicating materials from your research project. Due April 2. Draft version of research paper. Due April 18. Final version of research paper. Writing guides. In addition to McCloskey, and Strunk & White, students are invited to consult books on writing. There are also web sources, including: “Writing Economics: A Guide for Harvard’s Sophomore Economics Concentrators” (BBB) U. of Wisconsin Writer’s Handbook http://www.wisc.edu/writing/Handbook/CommonErrors.html#frag American Heritage Book of English Usage http://www.bartleby.com/64/2.html etc.


















ECON 1710, Spring 2013 SCHEDULE Date Session Topic Jan. 8 1 Introduction Jan. 10-15-17 2-3-4 The Global Economy – recent financial crisis and current recession; Euro-mess; current U.S. situation; can we expect future crises? Jan 22-24 5-6 Basic International Economics Jan 29-31 7-8 Government and the Economy Feb. 5-7 9-10 Economic Foundations: Information Feb. 12-14 11-12 Economic Foundations: Institutions Feb. 19-21 13-14 Economic Foundations: Innovation Feb. 26-28 15-16 Development economics: what is “development”? What are the big issues? March 5-7 17-18 China’s economy: what’s the story? How does it affect us? SPRING BREAK Mar. 19-28 19-22 Student research presentations April 2-4 23-24 Economics and health care April 9-11 24-25 Economics and the environment April 16-18 26-27 Personal finance – using economic thinking to build financial security


Readings January 10-15-17 The Recent Global Macroeconomic Crisis and Ongoing Recession Current Financial Crisis and Recession Zanny M. Beddoes, “For Richer, for Poorer,” Economist special report on the world economy, 2012 BBB John O’Sullivan, “A Game of Catch-Up” – Economist special report on the world economy 2011 BBB Economist Team, “How to Grow” special report on the world economy, October 2010 Greg Ip, “Time to Rebalance: A Special Report on America’s Economy,” Economist, 3 April 2010 Joseph Stiglitz (Nobel laureate), “The Financial Crisis of 2007-2008 and its Macroeconomic

Consequences,” in Time for a Visible Hand: Lessons from the 2008 World Financial Crisis, S. Griffith-Jones, J.A. Ocampo, and J.E. Stiglitz, eds., Initiative for Policy Dialogue Series, Oxford: Oxford University Press, 2010, pp. 19-49 (BBB)

Richard Koo slide presentation on “Balance Sheet Recession” See http://www.scribd.com/doc/13970982/Richard-Koo-Presentation Paul Krugman (Nobel laureate), 2 items – "Balance Sheets, the transfer problem and financial crises" (BBB) "Thinking About the Liquidity Trap" (BBB) Asian Financial Crisis of 1997-98 Giancarlo Corsettia, Paolo Pesentib, and Nouriel Roubini, “What caused the Asian currency and Financial crisis?” Japan and the World Economy 11 (1999) 305-373. BBB Joseph Stiglitz (Nobel laureate), “What I learned at the world economic crisis” http://vuzit.com/view/d3q To pursue this topic further, start with http://en.wikipedia.org/wiki/Asian_crisis Long Term Issues George Akerlof and Robert Shiller, Animal Spirits : how human psychology drives the economy… (HH) Karl Marx and Friedrich Engels, The Communist Manifesto. (BBB; also HH under Econ 0630) For reference: Economic Report of the President 2012. (2013 issue due in late January) http://www.gpo.gov/fdsys/pkg/ERP-2012/content-detail.html Jan. 22-24 Basic International Economics P. Krugman, “Is Free Trade Passe?” Journal of Economic Perspectives 1.2 (1987): 131-144. (BBB) [also of interest, Krugman’s “Narrow and Broad Arguments for Free Trade” BBB]




http://vuzit.com/view/d3q




http://www.gpo.gov/fdsys/pkg/ERP-2012/content-detail.html


Paul Romer, “Object Gaps and Idea Gaps in Economic Development,” Journal of Monetary Economics 32 (1993): 543-573 (BBB). David Ricardo, Principles of Political Economy and Taxation,” (1821), Chap. 31, “On Machinery” See http://phare.univ-paris1.fr/textes/Ricardo/Principles/prin3.txt; on reserve HHH Paul Samuelson (Nobel laureate), “Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization, J. of Economic Perspectives, 2004. BBB [also of interest: Raymond Vernon, “ International Trade and the Product Cycle” BBB] Jan. 29-31 Government and the Economy “Taming Leviathan” John Micklethwait, Economist special report Mar 17 2011 The Future of the State

BBB Bill Emmott, Economist Survey: "Capitalism and Democracy - Radical Birthday Thoughts," 6-26-2003

BBB Adrian Wooldridge, “The Visible Hand” – Economist special report on state capitalism, Jan 2012 BBB

Anne Krueger, “The Political Economy of the Rent-Seeking Society,” American Economic Review, 64.3 (1974): 291-303. (BBB)

World Bank World Development Report Investment Climate Summary BBB Sample of opposing political views: Jeff Madrick, “Less Government Better for Business? Not if History Provides a Guide,” NYTimes Jan. 20,

2005. BBB Philip K. Howard, “Washington vs. ‘Common Sense’” WSJ Op-ed. BBB Feb. 5-7 Economics and Information George J. Stigler (Nobel Laureate), “The Economics of Information,“ Journal of Political Economy, vol.

69 (1961): 213-225. Reprinted in Stigler, The Organization of Industry. BBB George Akerlof (Nobel Laureate), “The Market for ‘Lemons’ – Quality Uncertainty and the Market

Mechanism,” Quarterly Journal of Economics, 84.3 (1970): 488-500. BBB Joseph E. Stiglitz (Nobel Laureate), “Information and Economic Analysis: A Perspective,“ Economic

Journal, Vol. 95, Supplement: Conference Papers. (1985), pp. 21-41. BBB. Note: this is VERY



difficult – try to grasp the main ideas – don’t be surprised if you cannot follow the entire discussion.

Feb. 12-14 Economic Institutions Douglass North (Nobel Laureate), “Economic Performance Through Time,” American Economic Review

84.3 (1994): 359-368. BBB See also Alexander Field review of North, Understanding the Process of Economic Change (BBB) Herbert Simon (Pittsburgh-based Nobel Laureate from CMU), "Organizations and Markets," Journal of

Economic Perspectives, Vol. 5 (2), 1991, pp. 25-44. BBB D. Acemoglu et al, “The Colonial Origins of Comparative Development: An Empirical Investigation,”

American Economic Review, Dec. 2001. BBB. Ronald Coase (Nobel Laureate), “The Problem of Social Cost,” Journal of Law and Economics 3 (1960).

Reprinted in Ronald Coase, The Firm, The Market, and the Law. BBB World Development Report 2002: Building Institutions for Markets. Read Chapter 1: see

http://www.rrojasdatabank.info/wdr02/ch1.pdf Feb. 19-21 Innovation Joseph A. Schumpeter, Capitalism, Socialism, and Democracy (1942), Chap. 7 “The Process of Creative

Destruction,” pp. 81-86. BBB [Reviews and discussion available at http://books.google.com/books?id=6eM6YrMj46sC&dq=schumpeter+capitalism+socialism+and+democracy&printsec=frontcover&source=bn&hl=en&ei=ymZDS7nyHIfJlAfe3p2mBw&sa=X&oi=book_result&ct=result&resnum=4&ved=0CCAQ6AEwAw#v=onepage&q=&f=false ]

Robert J. Gordon, “Is U.S. Economic Growth Over? Faltering innovation confronts the six headwinds

(2012) BBB Zvi Griliches, "Research Costs and Social Returns: Hybrid Corn and Related Innovations," Journal of

Political Economy 66.5 (1958): 419-431. BBB William Nordhaus, 2 items:

“Do Real-Output and Real-Wage Measures Capture Reality? The History of Lighting Suggests Not.” 1997 working paper. BBB

“The Progress of Computing” (2001 working paper). BBB Feb. 26-28 Development









Brief overview of national income accounting: see major introductory texts (e.g. by Stiglitz,

Samuelson-Nordhaus, etc.) or http://en.wikipedia.org/wiki/Gross_national_product#Gross_National_Product The point: how to systematically characterize the difference between rich and poor nations. What is “purchasing power parity” (PPP)? See the International Comparison Project (ICP):


John O’Sullivan, “A Game of Catch-up.” Economist report on the world economy, Sept. 2011 (BBB). Joseph Stiglitz (Nobel laureate), The World Development Report: Development Theory and Policy, in

Development Economics Through the Decades: A Critical Look at 30 Years of the World Development Report, by Shahid Yusuf, Washington, DC: World Bank, 2008, p. 139-151. (BBB)

Michael Spence (Nobel laureate). “Why China Grows Fast”(2007). BBB Look at materials from “Copenhagen Consensus,” a project intended to produce careful economic

evaluations of proposed development initiatives:


David Dollar and Aart Kraay, "Trade, Growth, and Poverty," The Economic Journal, 114 (February 2004),

F22–F49. BBB March 5-7. China’s Economy Loren Brandt and T. Rawski, China’s Great Economic Transformation, chapter1: “China’s Great

Economic Transformation.” (BBB) [HH under Econ 1630; book also available as an e-book via Pittcat]

Simon Cox, “Pedalling Prosperity” Economist survey of China, May 2012. BBB James Miles, “Rising Power, Anxious State” survey of China, Economist, 23 June 2011 BBB T. Rawski, “Human Resources and China’s Long Economic Boom” BBB April 2-4 Economics and Health Care








Contributions by Alvin E. Roth (former Pitt Economics professor and 2012 Nobel laureate)- all BBB “Matching and Allocation.,.” – 2003 lecture Slides from Nobel Memorial Lecture – 2012 “Has Experimental Economics Lived up to its Expectations” (Roth is among the pioneers) “Kidney Exchange” (with T. Sonmez and former Pitt graduate student and professor U. Unver) –

aim to follow the key ideas – you won’t understand everything V. Vaitheeswaran, Economist survey on Health Care and Technology 2010. BBB Overview of health economics: http://en.wikipedia.org/wiki/Health_economics Is American Health Care Uniquely Inefficient?, Alan M Garber, Jonathan Skinner

Journal of Economic Perspectives. Nov 2008, Vol. 22, No. 4: Pages 27-50 (access via Pittcat electronic journals).

Economic perspective on President Obama’s 2009 proposals 2009 Letter from health economists to

President Obama http://www.huffingtonpost.com/2009/11/17/economists-tout-health-ca_n_361469.html April 9-11. Economics and the Environment Garrett Hardin, “The Tragedy of the Commons,” Classic 1968 article available

via http://www.dieoff.org/page95.htm Emma Duncan, “Getting Warmer: A special report on climate change and the carbon economy,

Economist, December 2009. (BBB)


Journal of Economic Perspectives 23.2 (Spring 2009) symposium on Climate Change – articles by Metcalf, Tol, and Barrett (BBB)

Here’s a site for global warming skeptics: http://www.globalwarming.org/ April 17-19. Personal Finance Philip Coggan, “Repent at Leisure: A Special Report on Debt” Economist, 24 June 2010. (BBB) Philip Coggan, “Falling Short” – special report on pensions, 2011.












Supporting Evidence









Language/ Mechanics






T.G. Rawski January 2013

NUMERICAL CODE FOR COMMENTS ON WRITING STYLE Use this code to interpret numbers written in the margins of your papers. 1. AWKWARD, CLUMSY prose. Rewrite. 2. Error of diction. You have used the WRONG WORD. 3. The text does not accurately convey your intended meaning. Rewrite. 4. Unintended double meaning (example - a cartoon showing President Clinton saying "I'd like to see Paula Jones drop her suit"). 5. Avoid passive constructions. Use MAN BITES DOG! rather than "dog is bitten by man." 6. Cut excess verbiage. 7. Reference implied by it, they, this, that, who, we - is not clear. 8. Use a DIRECT statement. Don't beat around the bush. 9. Error of NUMBER. Match singular nouns with singular verbs, and so on. 10. Do not splice sentences together, as in "Do you beat your dog and when will you stop?" 11. No sentence here. 12. This passage is not clear to the reader. Rewrite. 13. This passage MIXES TENSES. Do not confuse past, present, future. 14. Spelling error. 15. This passage jumps from one topic to another with no transition. 16. No mysteries please! This passage introduces new facts/ideas with no explanation. 17. Avoid endless paragraphs. A paragraph should develop a single idea or theme. 18. Avoid repetition. 19. Avoid “looping back” as in “This paper focuses on globalization. Globalization refers to…”; try to write in a linear fashion, moving forward without circling back to the previous sentence. In this context, better to write “This paper focuses on globalization, which refers to …”


Economics 1710: Suggested topics for “Two Page Summary” papers Global Financial Crisis and Recession of 2008-??? Countries/Regions Australia China France Germany Greece Iceland Ireland Italy Japan Latin America Russia Spain United Kingdom New trends Securitization Shadow banking system Hedge funds Mortgage-backed securities Auction rate notes Credit default swaps Companies AIG Bank of America Bear Sterns General Motors Goldman Sachs Lehman Brothers Merrill-Lynch MF Global Standard and Poor Official agencies European Central Bank (ECB) European Community Federal Deposit Insurance Corporation Federal Reserve Fannie Mae/Freddie Mac FDIC Securities and Exchange Commission Individuals Sheila Bair Ben Bernanke Warren Buffet Paul Krugman

Bernie Madoff Angela Merkel Henry Paulson Elizabeth Warren Tim Geithner Paul Volcker Regulatory Issues Short selling Taylor Rule Excess liquidity vs. inadequate regulation Too big to fail Regulatory capture Asian Financial Crisis of 1997-98 Overview China Indonesia Korea Role of IMF Thailand Policy issues Did Congress contribute to the crisis? Why does U.S. unemployment remain high? Was the U.S, stimulus well crafted? Does the financial reform legislation

address the causes of the financial crisis? Does the reform legislation remove or ameliorate systemic conflicts of interest? Does the US face a looming fiscal crisis? Is inflation likely? What is deflation? Is it likely? Will the US dollar decline sharply? Does China’s rise threaten U.S. jobs? What is the “fair tax share” of high-income

households? Break up the big banks?




Regular attendance and participation in class sessions. Occasional brief writing assignments.

Two short papers due Thursday January 29 and Thursday March 5. Research paper: prospectus due Tuesday February 17; oral presentation to be scheduled during March; draft version due Thursday April 2; final version due Thursday April 16.

Reading assignments: include several items available at the University Bookstore as well as materials available on the course website http://courseweb.pitt.edu (marked BBB), on reserve at Hillman ground floor (HH) through the University library’s web site - marked JJJ – note that back issues of many journals can be accessed through JSTOR – see http://www.library.pitt.edu/articles/database_info/jstor.html Also see the University Library’s collection of electronic journals: http://rt4rf9qn2y.search.serialssolutions.com/ Books ordered for this course:

Peter Schuck, Why government fails so often: and how it can do better (note e-version available via Hillman Library)

Mariana Mazzucato, The entrepreneurial state: debunking public vs. private sector myths Deirdre McCloskey, Economical Writing Andrea A. Lunsford, EASY WRITER 5th edition. W. Strunk and E.B. White, The Elements of Style [online at http://www.bartleby.com/141/ ]

















WRITING ASSIGNMENTS - PRINTED AND DOUBLE-SPACED Due January 8. 2 pages on any subject associated with the recent financial crisis and ensuing recession. You may (but need not) select a theme from the list of topics appended to this document. Due January 13. One page in which you explain some aspect of economic theory (comparative advantage, elasticity, expenditure multiplier, asymmetric information, green GDP – anything you like) for an audience of intelligent readers who have no exposure to economic thinking. Due January 15. One page in which you express strong opinions (on any subject) and persuade the reader to share your view. Feeling ambitious? Write a draft version of an op-ed submission instead. Due January 29. 5-10 pages: critical analysis and review of the Mazzucato and Schuck books. Due February 17. Prospectus for research paper. What’s the subject? What will you try to show or discover? What materials and methods will you use? What difficulties do you expect to encounter? Due March 5. 5-10 pages on any topic relevant to the subjects covered in this course. Please avoid duplicating materials from your research project. Due April 2. Draft version of research paper. Due April 16. Final version of research paper. Writing guides. In addition to McCloskey, and Strunk & White, students are invited to consult books on writing. There are also web sources, including: R. Neugeboren, The Student’s Guide to Writing Economics. See http://pitt.libguides.com/econwriting “Writing Economics: A Guide for Harvard’s Sophomore Economics Concentrators” (BBB) U. of Wisconsin Writer’s Handbook http://www.wisc.edu/writing/Handbook/CommonErrors.html#frag American Heritage Book of English Usage http://www.bartleby.com/64/2.html etc.









http://pitt.libguides.com/econwriting









ECON 1710, Spring 2015 SCHEDULE Date Session Topic Jan. 6 1 Introduction Jan. 8-13-15 2-3-4 The Global Economy – recent financial crisis and current recession; Euro-mess; current U.S. situation; can we expect future crises? Jan 20-22 5-6 Basic International Economics Jan 27-29 7-8 Economic Foundations: Information Feb. 3-5 9-10 Economic Foundations: Government and the Economy Feb. 10-12 11-12 Economic Foundations: Institutions Feb. 17-19 13-14 Economic Foundations: Innovation Feb. 24-26 15-16 Development economics: what is “development”? What are the big issues? March 3-5 17-18 Economics and the environment SPRING BREAK Mar. 17-26 19-22 Student research presentations April 2-4 23-24 Economics and inequality April 9-11 25-26 Economics and health care April 16-18 27-28 Personal finance – using economic thinking to build financial security


Readings January 8-13-15 The Recent Global Macroeconomic Crisis and Consequences Recent Financial Crisis, Recession, Recovery, Prospects Greg IP, "The Gated Globe," Economist survey of the world economy, Oct.10, 2013

Start with http://www.economist.com.pitt.idm.oclc.org/printedition/covers; Print edition special reports

Edward McBride, “Cheer Up” Economist special report on American competitiveness, Mar. 16, 2013 JJJ Start with http://www.economist.com.pitt.idm.oclc.org/printedition/covers; Print edition special reports Joseph Stiglitz (Nobel laureate), “The Financial Crisis of 2007-2008 and its Macroeconomic

Consequences,” in Time for a Visible Hand: Lessons from the 2008 World Financial Crisis, S. Griffith-Jones, J.A. Ocampo, and J.E. Stiglitz, eds., Initiative for Policy Dialogue Series, Oxford: Oxford University Press, 2010, pp. 19-49 (BBB)

John Cochrane, Wall Street Journal Op-eds – look at the first two – on Keynes and deflation. Richard Koo slide presentation on “Balance Sheet Recession”

See http://www.scribd.com/doc/13970982/Richard-Koo-Presentation Paul Krugman (Nobel laureate), 2 items – "Balance Sheets, the transfer problem and financial crises" (BBB) "Thinking About the Liquidity Trap" (BBB) Asian Financial Crisis of 1997-98 Giancarlo Corsettia, Paolo Pesentib, and Nouriel Roubini, “What caused the Asian currency and financial crisis?” Japan and the World Economy 11 (1999) 305-373. BBB Joseph Stiglitz (Nobel laureate), “What I learned at the world economic crisis” BBB To pursue this topic further, start with http://en.wikipedia.org/wiki/Asian_crisis Long Term Issues George Akerlof and Robert Shiller, Animal Spirits: how human psychology drives the economy… (HH) Karl Marx and Friedrich Engels, The Communist Manifesto. (BBB; also HH under Econ 0630) For reference: Economic Report of the President 2014. (2015 issue due in late January) http://www.whitehouse.gov/administration/eop/cea/economic-report-of-the-President/2014

http://www.economist.com.pitt.idm.oclc.org/printedition/covers








http://www.whitehouse.gov/administration/eop/cea/economic-report-of-the-President/2014


Jan. 20-22 Basic International Economics P. Krugman, “Is Free Trade Passe?” Journal of Economic Perspectives 1.2 (1987): 131-144. (BBB) [also of interest, Krugman’s “Narrow and Broad Arguments for Free Trade” BBB] Paul Romer, “Object Gaps and Idea Gaps in Economic Development,” Journal of Monetary Economics 32 (1993): 543-573 (BBB). David Ricardo, Principles of Political Economy and Taxation,” (1821), Chap. 31, “On Machinery” See http://phare.univ-paris1.fr/textes/Ricardo/Principles/prin3.txt; on reserve HHH Paul Samuelson (Nobel laureate), “Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization,” J. of Economic Perspectives, 2004. BBB [also of interest: Raymond Vernon, “ International Trade and the Product Cycle” BBB] Jan. 27-29. Economics and Information George J. Stigler (Nobel Laureate), “The Economics of Information,“ Journal of Political Economy, vol.

69 (1961): 213-225. Reprinted in Stigler, The Organization of Industry. BBB George Akerlof (Nobel Laureate), “The Market for ‘Lemons’ – Quality Uncertainty and the Market

Mechanism,” Quarterly Journal of Economics, 84.3 (1970): 488-500. BBB Joseph E. Stiglitz (Nobel Laureate), “Information and Economic Analysis: A Perspective,” Economic

Journal, Vol. 95, Supplement: Conference Papers. (1985), pp. 21-41. BBB. Note: this is VERY difficult – try to grasp the main ideas – don’t be surprised if you cannot follow everything.

Feb. 3-5. Government and the Economy “Taming Leviathan” John Micklethwait, Economist special report Mar 17, 2011 The Future of the State

BBB Adrian Wooldridge, “The Visible Hand” – Economist special report on state capitalism, Jan 2012 BBB Anne Krueger, “The Political Economy of the Rent-Seeking Society,” American Economic Review, 64.3

(1974): 291-303. (BBB) Philip Coggan, “A world of robber barons” – Economist special report on Companies and the state, Feb 20th 2014 Start with http://www.economist.com.pitt.idm.oclc.org/printedition/covers; Print edition special reports World Bank World Development Report Investment Climate Summary BBB


http://www.economist.com.pitt.idm.oclc.org/news/special-report/21596667-relationship-between-business-and-government-becoming-increasingly-antagonistic



Feb. 10-12. Economic Institutions Douglass North (Nobel Laureate), “Economic Performance Through Time,” American Economic Review

84.3 (1994): 359-368. BBB See also Alexander Field review of North, Understanding the Process of Economic Change (BBB) Herbert Simon (Pittsburgh-based Nobel Laureate from CMU), "Organizations and Markets," Journal of

Economic Perspectives, Vol. 5 (2), 1991, pp. 25-44. BBB D. Acemoglu et al, “The Colonial Origins of Comparative Development: An Empirical Investigation,”

American Economic Review, Dec. 2001. BBB. Ronald Coase (Nobel Laureate), “The Problem of Social Cost,” Journal of Law and Economics 3 (1960).

Reprinted in Ronald Coase, The Firm, The Market, and the Law. BBB World Development Report 2002: Building Institutions for Markets. Read Chapter 1: see

http://www.rrojasdatabank.info/wdr02/ch1.pdf Feb. 19-21 Innovation Joseph A. Schumpeter, Capitalism, Socialism, and Democracy (1942), Chap. 7 “The Process of Creative

Destruction,” pp. 81-86. BBB [Reviews and discussion available at http://books.google.com/books?id=6eM6YrMj46sC&dq=schumpeter+capitalism+socialism+and+democracy&printsec=frontcover&source=bn&hl=en&ei=ymZDS7nyHIfJlAfe3p2mBw&sa=X&oi=book_result&ct=result&resnum=4&ved=0CCAQ6AEwAw#v=onepage&q=&f=false ]

Robert J. Gordon, “Is U.S. Economic Growth Over? Faltering innovation confronts the six headwinds”

(2012) BBB Zvi Griliches, "Research Costs and Social Returns: Hybrid Corn and Related Innovations," Journal of

Political Economy 66.5 (1958): 419-431. BBB Look at one or more of these Economist special reports:

http://www.economist.com.pitt.idm.oclc.org/printedition/covers Print edition special reports Ryan Avent, “The third great wave. Special report on the world economy,” Oct 10, 2014 (JJJ). Oliver Morton, “Immigrants from the future.” Special report on robots. Mar 27th 2014

Ludwig Siegele , “A Cambrian moment.” Special report on Tech startups, Jan 18th 2014

Feb. 24-26 Development Brief overview of national income accounting: see major introductory texts (e.g. by Stiglitz,









http://www.economist.com.pitt.idm.oclc.org/news/special-report/21621156-first-two-industrial-revolutions-inflicted-plenty-pain-ultimately-benefited

http://www.economist.com.pitt.idm.oclc.org/news/special-report/21599522-robots-offer-unique-insight-what-people-want-technology-makes-their

http://www.economist.com.pitt.idm.oclc.org/news/special-report/21593580-cheap-and-ubiquitous-building-blocks-digital-products-and-services-have-caused


Samuelson-Nordhaus, etc.) or http://en.wikipedia.org/wiki/Gross_national_product#Gross_National_Product The point: how to systematically characterize the difference between rich and poor nations. John O’Sullivan, “A Game of Catch-up.” Economist report on the world economy, Sept. 2011 (BBB). Joseph Stiglitz (Nobel laureate), The World Development Report: Development Theory and Policy, in

Development Economics Through the Decades: A Critical Look at 30 Years of the World Development Report, by Shahid Yusuf, Washington, DC: World Bank, 2008, p. 139-151. (BBB)

Michael Spence (Nobel laureate). “Why China Grows Fast”(2007). BBB Oliver August, “The Hopeful Continent” Economist special report on Emerging Africa, March 2, 2013. http://www.economist.com.pitt.idm.oclc.org/printedition/covers Print edition special reports Look at materials from “Copenhagen Consensus,” a project intended to produce careful economic

evaluations of proposed development initiatives:


March 3-5. Environment Garrett Hardin, “The Tragedy of the Commons,” Classic 1968 article available

via http://www.dieoff.org/page95.htm Emma Duncan, “Getting Warmer: A special report on climate change and the carbon economy,

Economist, December 2009. (BBB)


Journal of Economic Perspectives 23.2 (Spring 2009) symposium on Climate Change – articles by Metcalf, Tol, and Barrett (BBB)

Here’s a site for global warming skeptics: http://www.globalwarming.org/ March 31-April 2. Inequality









Thomas Piketty, Capital in the twenty-first century. Online via PittCat. Take a look. B. Milanovic, “The Return of “Patrimonial Capitalism”: A Review of Thomas Piketty’s Capital in the Twenty-First Century.” Journal of Economic Literature 52.2 (2014). BBB Arthur Okun, Equality and efficiency, the big tradeoff. (HH) B. Milanovic, Global Income Inequality by the Numbers: in History and Now (2012). BBB (check his posting of

12-22-2014 at http://glineq.blogspot.com/ What is “purchasing power parity” (PPP)? See the International Comparison Project (ICP):


April 7-9 Economics and Health Care Contributions by Alvin E. Roth (former Pitt Economics professor and 2012 Nobel laureate)- all BBB “Matching and Allocation.,.” – 2003 lecture Slides from Nobel Memorial Lecture – 2012 “Has Experimental Economics Lived up to its Expectations” (Roth is among the pioneers) “Kidney Exchange” (with T. Sonmez and former Pitt graduate student and professor Utku Unver)

aim to follow the key ideas – you may not understand everything V. Vaitheeswaran, Economist survey on Health Care and Technology 2010. BBB Overview of health economics: http://en.wikipedia.org/wiki/Health_economics Is American Health Care Uniquely Inefficient?, Alan M Garber, Jonathan Skinner

Journal of Economic Perspectives. Nov 2008, Vol. 22, No. 4: Pages 27-50 (access via Pittcat electronic journals).

Economic perspective on President Obama’s 2009 proposals 2009 Letter from health economists to

President Obama http://www.huffingtonpost.com/2009/11/17/economists-tout-health-ca_n_361469.html April 17-19. Personal Finance Philip Coggan, “Repent at Leisure: A Special Report on Debt” Economist, 24 June 2010. (BBB) Philip Coggan, “Falling Short” – Economist special report on pensions, April 7, 2011. BBB

http://glineq.blogspot.com/












Supporting Evidence









Language/ Mechanics






T.G. Rawski January 2015

NUMERICAL CODE FOR COMMENTS ON WRITING STYLE Use this code to interpret numbers written in the margins of your papers. 1. AWKWARD, CLUMSY prose. Rewrite. 2. Error of diction. You have used the WRONG WORD. 3. The text does not accurately convey your intended meaning. Rewrite. 4. Unintended double meaning (example - a cartoon showing President Clinton saying "I'd like to see Paula Jones drop her suit"). 5. Avoid passive constructions. Use MAN BITES DOG! rather than "dog is bitten by man." 6. Cut excess verbiage. 7. Reference implied by it, they, this, that, who, we - is not clear. 8. Use a DIRECT statement. Don't beat around the bush. 9. Error of NUMBER. Match singular nouns with singular verbs, and so on. 10. Do not splice sentences together, as in "Do you beat your dog and when will you stop?" 11. No sentence here. 12. This passage is not clear to the reader. Rewrite. 13. This passage MIXES TENSES. Do not confuse past, present, future. 14. Spelling error. 15. This passage jumps from one topic to another with no transition. 16. No mysteries please! This passage introduces new facts/ideas with no explanation. 17. Avoid endless paragraphs. A paragraph should develop a single idea or theme. 18. Avoid repetition. 19. Avoid “looping back” as in “This paper focuses on globalization. Globalization refers to…”; try to write in a linear fashion, moving forward without circling back to the previous sentence. In this context, better to write “This paper focuses on globalization, which refers to …”


Economics 1710: Suggested topics for “Two Page Summary” papers Global Financial Crisis, Recession and Recovery 2008-??? Countries/Regions Australia China France Germany Greece Iceland Ireland Italy Japan Latin America Russia Spain United Kingdom New trends Securitization Shadow banking system Hedge funds Mortgage-backed securities Auction rate notes Credit default swaps Companies AIG Bank of America Bear Sterns General Motors Goldman Sachs Lehman Brothers Merrill-Lynch MF Global Standard and Poor Official agencies European Central Bank (ECB) European Community Federal Deposit Insurance Corporation Federal Reserve Fannie Mae/Freddie Mac FDIC Securities and Exchange Commission Individuals Sheila Bair Ben Bernanke Warren Buffet Paul Krugman

Bernie Madoff Angela Merkel Henry Paulson Elizabeth Warren Tim Geithner Paul Volcker Regulatory Issues Short selling Taylor Rule Excess liquidity vs. inadequate regulation Too big to fail Regulatory capture Asian Financial Crisis of 1997-98 Overview China Indonesia Korea Role of IMF Thailand Policy issues Did Congress contribute to the crisis? Why keeps U.S. unemployment high? Was the U.S, stimulus well crafted? Does the financial reform legislation

address the causes of the financial crisis? Does the reform legislation remove or ameliorate systemic conflicts of interest? Does the US face a looming fiscal crisis? Is inflation likely? What is deflation? Is it likely? Will the US dollar rise/decline sharply? Does China’s rise threaten U.S. jobs? What is the “fair tax share” of high-income

households? Break up the big banks?

1

PROSEM IN INTERNATIONAL ECONOMICS (W)

“Latin American Economic Development”

Econ 1710 - Fall 2015

Course information Instructor:

Marla Ripoll – 4532 WWPH – 412 648 2243 – [email protected]

Office hours: Monday 2:00 – 3:00 p.m., or by appointment

Course website:

Class materials are available at http://courseweb.pitt.edu

Objectives Latin America’s history of economic development is unique, puzzling and interesting. This

course uses data together with concepts and theories from the field of economic growth and

development in order to understand the distinct features of economic performance in Latin

American countries. Commonalities and differences among Latin American countries are

analyzed. Topics covered include Latin American economic history, growth accounting, import

substitution industrialization, trade policy, exchange rate policy and the current account,

monetary and fiscal policy, macroeconomic stability, rural development, poverty and inequality,

demographic change, health policy, economic growth and the environment, and Latin America in

the global economy.

Textbook Franko, Patrice. 2007. The Puzzle of Latin America Economic Development, 3

rd edition.

Rowman & Littlefield.

Other recommended books

Bulmer-Thomas, Victor. 2003. The Economic History of Latin America since

Independence, 2nd

edition. Cambridge University Press.

Cardoso, Eliana and Ann Helwege. 1992. Latin America’s Economy: Diversity, Trends

and Conflicts. MIT Press.

Edwards, Sebastian, Gerardo Esquivel and Graciela Marquez, editors. 2007. The Decline

of Latin American Economies: Growth, Institutions and Crises. University of Chicago

Press. Available by chapter free on-line:

http://www.nber.org/books/edwa04-1

Lora, Eduardo, coordinator. 2008. Beyond Facts: Understanding Quality of Life. Inter-

American Development Bank and David Rockefeller Center for Latin American Studies,

Harvard University. Available free on-line:

http://www.iadb.org/IDBDocs.cfm?docnum=1775002

Reyes, Javier and W. Charles Sawyer. 2011. Latin America Economic Development.

Routledge.

Thorp, Rosemary. 1998. Progress, Poverty and Exclusion: An Economic History of Latin

America in the 20th Century. John Hopkins University Press.

Instructional components and evaluation

Quizzes on reading materials (25%)

Opinion pieces and student panels (35%)

Term research paper (20%)



http://www.nber.org/books/edwa04-1

http://www.iadb.org/IDBDocs.cfm?docnum=1775002

2

“News from Latin America” – presentation and essay for Panoramas (15%)

Participation in class activities (5%)

Reading materials and quizzes This will be a reading and writing intensive class constructed around specific topics. Book

chapters and academic papers are combined to document each topic. It is very important that you

read all mandatory articles before coming to class, so you are prepared to participate in small-

group discussion and are better able to understand other contents that will be presented in class.

Due dates of mandatory readings are indicated below, but there might be changes during the term

depending on the pace at which the course evolves. Any changes will be announced in class.

There will be quizzes on assigned readings. Quizzes will be short and will consist of multiple-

choice and true-and-false questions designed to test that you have read and studied the materials.

Reading materials other than the textbook are available at http://courseweb.pitt.edu

Quizzes policy There are no make-up quizzes, regardless of the reason of absence. However, I will drop the

lowest two scores of the quizzes in computing your final grade.

If due to exceptional circumstances you must be absent from class for a prolonged period of time

during the term and miss more than two pop quizzes, please contact the instructor promptly.

Opinion pieces and student panels There will be a total of five student panels on different topics throughout the term. There are two

papers assigned as background reading for each panel (see below). All students should hand in a

three-page typewritten opinion piece at the beginning of the class on a panel day. In addition,

each student will be part of the live discussion in only one of the panels. Students will be

surveyed on preferences and assigned to one of the live panels at the beginning of the term. The

instructor will serve as a moderator of each panel. Notice that all students should hand in a hard

copy of an opinion piece for every panel, even if they will not be part of the live discussion that

day. Specific instructions, the rubric that will be used for opinion pieces, and samples of opinion

pieces from former students, can be found on the handout “opinion-pieces” in course web.

Panel # 1 – Was colonization the culprit of Latin America’s inequality?

Date: September 16th

Papers:

o Sokoloff, Kenneth and Stanley Engerman. 2000. “Institutions, Factor

Endowments and Paths of Development in the New World.” Journal of

Economic Perspectives, 14 (3), 217-232

o Williamson, Jeffrey. 2009. “History without Evidence: Latin American

Inequality since 1491.” NBER Working Paper No. 14766

Panel # 2 – What should the role of governments in Latin America be?

Date: September 30th

Papers:

o Fishlow, Albert. 1990. “The Latin American State.” Journal of Economic

Perspectives, 4 (3), 61-74

o Rodrik, Dani. 2006. “Goodbye Washington Consensus, Hello Washington

Confusion? A Review of the World Bank’s Economic Growth in the 1990s:

Learning from a Decade of Reform.” Journal of Economic Literature, 44, 973-

987


3

Panel # 3 – How should Latin America finance its development?

Date: October 21st

Papers:

o Aizenman, Joshua. 2005. “Financial Liberalizations in Latin America in the

1990s: A Reassessment.” NBER Working Paper No. 11145

o Ocampo, Jose Antonio and Daniel Titelman. 2012. “Regional Monetary

Cooperation in Latin America.” Asian Development Bank Institute Working

Paper No. 373

Panel # 4 – Is trade the solution to Latin American development?

Date: November 11th

Papers:

o Dornbusch, Rudiger. 1992. “The Case for Trade Liberalization in Developing

Countries.” Journal of Economic Perspectives, 6 (1), 69-85

o Sanchez, Omar. 2003. “Globalization as a Development Strategy in Latin

America?” World Development, 31 (12), 1977-1995

Panel # 5 – Who has a job in Latin America?

Date: December 2nd

Papers:

o Maloney, William. 2004. “Informality Revisited.” World Development, 32 (7),

1159-1178

o Clark, Ximena, Timothy Hatton and Jeffrey Williamson. 2004. “What Explains

Emigration Out of Latin America?” World Development, 32 (11), 1871-1890

Term research paper At the beginning of the term each student will choose one Latin American country to research and

write about. There will be a term research paper on the country of your choice due the last day of

classes. The objective of the paper is that you choose a research question on any topic related to

economic development, and use the concepts and theories from the reading materials and class

discussions to answer your research question. You could browse through the outline of topics

provided below, and the papers listed there (both mandatory and additional papers) to help you

choose a topic and think of a research question relevant to your country of choice. You could also

explore the different countries by browsing the data and web sources indicated below. On

Wednesday October 14th, you should hand-in a one-page project identifying your country of

choice, the research question you would like to answer, and the sources you have identified to use

in your term paper. Here are the important dates again:

One-page research project due on Wednesday October 14th

Term paper due on Wednesday December 9th

Please refer to the separate hand-out “term-paper” available in course web for more details, the

rubric that will be used in grading your paper, and a sample of term research papers from former

students.

“News from Latin America” Each student will have the opportunity to give a 10-minute presentation of news from their Latin

American country of choice. News should be relevant for economic development, related to the

course contents, coming from high-quality sources, and interesting enough to capture the

audience. The presentation should consist of clearly stating the news and its source, and then

analyzing the news item(s) by using economic concepts. Appropriate textbook chapters or

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reading materials listed below by topic can be consulted in helping the analysis. Visual or any

other materials to enhance the presentation may be used. Presentation dates will be spread

throughout the term and will be assigned and announced by the instructor within the first few

weeks of classes. Useful news sources include, but are not limited to, the following:

http://www.latinnews.com/

http://www.latinnews.com/latin-american-weekly-report.html

http://www.panoramas.pitt.edu/

A 500 to 2,000 summary of your analysis should be handed in to the instructor before the

presentation. I will provide comments on the written summary. Depending on the quality of the

final version, the essay could be submitted to Panoramas, the newsletter of the Center for Latin

American Studies (CLAS) here at Pitt: http://www.panoramas.pitt.edu

Outline of topics and mandatory reading materials

Topic 1 – Introduction: Characterizing Development in Latin America

Franko. 2007. Chapter 1: “Development in Latin America: Conceptualizing Economic

Change in the Region”

Video clip:

“The Global Divide” and “Capitalism Redefined (Peru)”, excerpts from PBS

Commanding Heights, Episode 3

Topic 2 – Historic Legacies: Colonization, the Great Depression and World War I

(Sep 9) Franko. 2007. Chapter 2: “Historical Legacies: Patterns of Unequal and Unstable

Growth”

(Sep 9) Coatsworth, John and Jeffrey Williamson. 2004. “Always Protectionist? Latin

American Tariffs from Independence to Great Depression.” Journal of Latin American

Studies, 36, 205-232

Topic 3 – Import Substitution: After World War II

(Sep 23) Franko. 2007. Chapter 3: “Import Substitution Industrialization: Looking Inward

for the Source of Economic Growth”

Love, Joseph. 2005. “The Rise and Decline of Economic Structuralism in Latin America:

New Dimensions.” Latin American Research Review, 40 (3), 100-125

Video clip:

“Latin America Dependencia” and “Contrarevolution in Chile”, excerpts from PBS

Commanding Heights, Episode 2

Topic 4 –Foreign Debt Crisis: The 1980s

(Sep 23) Franko. 2007. Chapter 4: “Latin America Debt Crisis: The Limits of External

Financing”

Topic 5 – Macroeconomic Stabilization: The 1990s

(Oct 7) Franko. 2007. Chapter 5: “Macroeconomic Stabilization: A Critical Ingredient for

Sustained Growth”

(Oct 7) Lustig, Nora. 2001. “Life is not Easy: Mexico’s Quest for Stability and Growth.”

Journal of Economic Perspectives, 15 (1), 85-106

Video clip:

“Bolivia at the Brink” and “Shock Therapy Applied”, excerpts from PBS Commanding

Heights, Episode 2

http://www.latinnews.com/

http://www.latinnews.com/latin-american-weekly-report.html

http://www.panoramas.pitt.edu/

http://pitt.us7.list-manage.com/track/click?u=3d004cc5edca55447f04a9110&id=32e2d2684e&e=198ffb4dd2

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Topic 6 – Fiscal Policy and the Role of Government

(Oct 14) Franko. 2007. Chapter 6: “The Role of the State: From a Smaller to a Smarter

State”

Topic 7 – Capital Flows and Currency Crisis

(Oct 21) Franko. 2007. Chapter 7: “Financing for Development: Public and Private

Capital Flows to Latin America”

(Oct 28) Edwards, Sebastian. 2003. “Financial Instability in Latin America.” Journal of

International Money and Finance, 22, 1095-1106

Topic 8 –Trade Policy

(Oct 28) Franko. 2007. Chapter 8: “Contemporary Trade Policy: Engine or Brakes for

Growth?”

(Nov 4) Morley, Samuel. 2001. “What Has Happened to Growth in Latin America?”

International Food Policy Research Institute, Trade and Macroeconomics Division

Discussion Paper No. 67

Video clip:

“NAFTA: The First Test,” “Crossing Borders” and “Averting a Meltdown: 1994”

excerpts from PBS Commanding Heights, Episode 3

Topic 9 – Sources of Growth: Technology, Capital and Labor

(Nov 4) Franko. 2007. Chapter 9: “Policies Underpinning Growth: Productivity and

Competitiveness in the Global Economy”

Topic 10 – Rural and Urban Development

(Nov 18) Franko. 2007. Chapter 10: “Rural Development: Sowing the Seeds of

Equitable, Sustainable Growth in Latin America”

Video clip:

“Brazil’s land revolution”, BBC Life 4

Topic 11 – Poverty and Inequality

(Nov 18) Franko. 2007. Chapter 11: “Poverty and Inequality: Addressing the Social

Deficit in Latin America”

Video clip:

“Bolivian Blues”, BBC Life

Topic 12 – Health and Social Security

Franko. 2007. Chapter 12: “Health Policy: Investing in People’s Future”

(Dec 9) Mesa-Lago, Carmelo. 2002. “Myth and Reality of Pension Reform: The Latin

American Evidence.” World Development, 30 (8), 1309-1321

Video clip:

“Not the Numbers Game (Peru)”, Bullfrog Films

Topic 13 –Education Policy

(Dec 9) Franko. 2007. Chapter 13: “Education Policy: The Source of Equitable,

Sustainable Growth”

Gimenez, Gregorio. 2006. “The Human Capital Endowment of Latin America and the

Caribbean.” Cepal Review, 86, 97-116

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Topic 14 – Growth and the Environment

Franko. 2007. Chapter 14: “Environmental Challenges: Internalizing the Costs of

Development”

Jenkins, Rhys. 2003. “Has Trade Liberalization Created Pollution Havens in Latin

America?” Cepal Review, 80, 81-95

Data and web sources

Statistics and Databases – Inter-American Development Bank

http://www.iadb.org/en/research-and-data/statistics-and-databases,3161.html

The link above provides access to the following specific databases:

o DataGov – Governance databases

o Macro Watch Data Tool – Over 500 indicators of macroeconomic activity

o REVELA – Inflation and growth expectations

o Sociometro-BID – Social indicators

o INTradeBID – Trade and integration

Publications – Inter-American Development Bank

http://www.iadb.org/publications/index.cfm?lang=en

The link provides access to books, working papers, policy briefs, magazines, journals,

newsletters and discussion papers. Documents can be search by topic and by country

World DataBank – World Bank

http://databank.worldbank.org/data/Home.aspx

This link provides access to the following databases:

o World Development Indicators (WDI)

o Education Statistics

o Gender Statistics

o Health Nutrition and Population Statistics

o Poverty and Inequality Database

o Doing Business

o Millennium Development Goals

o Jobs

o Global Financial Development

Policy evaluation – Poverty Action Lab in Latin America and the Caribbean

http://www.povertyactionlab.org/people/latin-america

The link provides access to the list of researchers conducting policy evaluation in Latin

America. For each researcher, click the link “evaluations” to find the relevant reports

Additional reading materials for research

Topic 1 – Introduction: Characterizing Development in Latin America

Bulmer-Thomas. 2003. Chapter 1: “Latin American Economic Development: An

Overview”

Cardoso and Helwege. 1992. Chapter 1: “The Economic Landscape”

Cardoso and Helwege. 1992. Chapter 3: “Theories, Ideas and Opinions”

Edwards, Esquivel and Marquez, editors. 2007. Chapter 1: “When Did Latin America

Fall Behind” by Leandro Prados de la Escosura

Lora. 2008. Chapter 1: “Quality of Life Viewed through Another Lens”

Lora. 2008. Chapter 2: “The Personality of Quality of Life Perceptions”

Lora, 2008. Chapter 4: “Satisfaction Beyond Income”

Reyes and Sawyer. 2011. Chapter 1: “Latin America and the World Economy”

Thorp. 1998. Chapter 2: “Growth and the Quality of Life over the Century”

http://www.iadb.org/en/research-and-data/statistics-and-databases,3161.html

http://www.iadb.org/publications/index.cfm?lang=en

http://databank.worldbank.org/data/Home.aspx

http://www.povertyactionlab.org/people/latin-america

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Topic 2 – Historic Legacies: Colonization, the Great Depression and World War I

Acemoglu, Daron, and James Robinson. 2008. “The Persistence and Change of

Institutions in the Americas.” Southern Economic Journal, 75 (2), 282-299

Acemoglu, Daron, Camilo Garcia-Jimeno and James Robinson. 2012. “Finding Eldorado:

Slavery and Long-Run Development in Colombia.” Journal of Comparative Economics,

40, 534-564.

Bulmer-Thomas. 2003. Chapter 2: “The Struggle for National Identity From

Independence to Midcentury”

Bulmer-Thomas. 2003. Chapter 3: “The Export Sector and the World Economy, Circa

1850-1914”

Bulmer-Thomas. 2003. Chapter 6: “First World War and its Aftermath”

Cardoso and Helwege. 1992. Chapter 2: “Historical Roots”

Edwards, Esquivel and Marquez, editors. 2007. Chapter 2: “Before the Golden Age:

Economic Growth in Mexico and Portugal, 1910-1950” by Pedro Lains

Nunn, Nathan and Nancy Qian. 2010. “The Columbian Exchange: A History of Disease,

Food and Ideas.” Journal of Economic Perspectives, 24 (2), 163-188

Reyes and Sawyer. 2011. Chapter 4: “Latin America Economic History”

Thorp. 1998. Chapter 3: “The Early 20th Century: Capital, Exports and Institutions”

Topic 3 – Import Substitution: After World War II

Bulmer-Thomas. 2003. Chapter 7: “Policy, Performance and Structural Change in the

1930s”

Bulmer-Thomas. 2003. Chapter 8: “War and the New International Economic Order”

Bulmer-Thomas. 2003. Chapter 9: “Inward-Looking Development in the Postwar

Period”

Cardoso and Helwege. 1992. Chapter 4: “From Import Substitution to Trade

Liberalization”

Dos Santos, Theotonio. 1970. “The Structure of Dependence.” American Economic

Review, 60 (2), 231-236.

Edwards, Sebastian. 1994. “Trade and Industrial Policy Reform in Latin America.”

NBER Working Paper No. 4772.

Peres, Wilson. 2011. “Industrial Policies in Latin America.” United Nations University,

World Institute for Development Economic Research Working Paper No. 2011/48

Reyes and Sawyer. 2011. Chapter 6: “Import Substitution in Latin America”

Thorp. 1998. Chapter 4: “Dislocation and Experiment: 1914-45”

Thorp. 1998. Chapter 5: “Industrialization and the Growing Role of the State: 1945-73”

Thorp. 1998. Chapter 6: “Growth and Emerging Disequilibria: 1945-73”

Topic 4 –Foreign Debt Crisis: The 1980s

Bulmer-Thomas. 2003. Chapter 10: “New Trade Strategies and Debt-Led Growth”

Bulmer-Thomas. 2003. Chapter 11: “Debt, Adjustment and the Shift to a New Paradigm”

Cardoso and Helwege. 1992. Chapter 5: “Debt”

Edwards, Sebastian. 1988. “The Debt Crisis and Economic Adjustment in Latin

America.” UCLA Working Paper No. 531.

Edwards, Sebastian. 2009. “Forty Years of Latin America’s Economic Development:

From the Alliance of Progress to the Washington Consensus.” NBER Working Paper No.

15190

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Pastor, Manuel. 1989. “Latin America, the Debt Crisis and the International Monetary

Fund.” Latin American Perspectives, 16 (1), 79-110

Sachs, Jeffrey. 1985. “External Debt and Macroeconomic Performance in Latin America

and East Asia.” Brooking Papers on Economic Activity, 2, 523-573

Thorp. 1998. Chapter 7: “Debt-led Growth, Disaster and Redirection after 1973”

Topic 5 – Macroeconomic Stabilization: The 1990s

Cardoso and Helwege. 1992. Chapter 6: “Inflation”

Cardoso and Helwege. 1992. Chapter 7: “Stabilization”

Edwards, Esquivel and Marquez, editors. 2007. Chapter 8: “Establishing Credibility: The

Role of Foreign Advisors in Chile’s 1955-1958 Stabilization Program” by Sebastian

Edwards

Fischer, Stanley, Ratna Sahay and Carlos Vegh. 2002. “Modern Hyper- and High

Inflations.” Journal of Economic Literature, 40, 837-880

Fraga, Arminio. 2004. “Latin America since the 1990s: Raising from the Sickbed?”

Journal of Economic Perspectives, 18 (2), 89-106

Lora, Eduardo. 2001. “Structural Reforms in Latin America: What Has Been Reformed

and How to Measure It.” Inter-American Development Bank.

Ocampo, Jose Antonio. 2004. “Latin America’s Growth and Equity Frustrations During

Structural Reforms.” Journal of Economic Perspectives, 18 (2), 67-88

Reyes and Sawyer. 2011. Chapter 10: “Macroeconomic Policy in Latin America”

Reyes and Sawyer. 2011. Chapter 11: “Macroeconomic Stability”

Topic 6 – Fiscal Policy and the Role of Government

Alesiana, Alberto, Ricardo Hausmann, Rudolf Hommes, and Ernesto Stein. 1999.

“Budget Institutions and Fiscal Performance in Latin America.” Journal of Development

Economics, 59, 253-273

Cardenas, Mauricio. 2010. “State Capacity in Latin America.” Global Economy and

Development, Brookings Institute.

Cardoso and Helwege. 1992. Chapter 8: “Economic Populism”

Chong, Alberto, and Francisco Lopez-de-Silanes. 2004. “Privatization in Latin America:

What Does the Evidence Say?” Economia, Spring, 37-111

Fishlow, Albert. 1990. “The Latin American State.” Journal of Economic Perspectives, 4

(3), 61-74

OECD. 2012. Latin American Economic Outlook 2012: Transforming the State for

Development. Available free on-line:

http://www.oecd-ilibrary.org/development/latin-american-economic-outlook-2012_leo-

2011-en

Shleifer, Andrei. 2009. “The Age of Milton Friedman.” Journal of Economic Literature,

47 (1), 123-135.

Tanzi, Vito. 1992. “Fiscal Policy and Economic Reconstruction in Latin America.”

World Development, 20 (5), 641-657

Thorp. 1998. Chapter 8: “Performance and Policy Making under the New Paradigm”

Topic 7 – Capital Flows and Currency Crisis

Edwards, Sebastian. 1989. “Exchange Controls, Devaluations and Real Exchange Rates:

The Latin American Experience.” Economic Development and Cultural Change, 37 (3),

457-494

http://www.oecd-ilibrary.org/development/latin-american-economic-outlook-2012_leo-2011-en


9

Edwards, Esquivel and Marquez, editors. 2007. Chapter 4: “Financial Crisis, 1880-1913:

The Role of Foreign Currency Debt” by Michael Bordo and Christopher Meissner

Edwards, Esquivel and Marquez, editors. 2007. Chapter 7: “Sudden Stops and Currency

Drops: A Historical Look” by Luis Catao

Porzecanski, Arturo. 2009. “Latin America: The Missing Financial Crisis.” Munich

Personal Research Archive Paper No. 18974.

Reyes and Sawyer. 2011. Chapter 8: “Exchange Rate Policy”

Reyes and Sawyer. 2011. Chapter 9: “Financing Current Account Deficits”

Topic 8 –Trade Policy

Bertola, Luis and Jeffrey Williamson. 2003. “Globalization in Latin America before

1940.” NBER Working Paper No. 9687

Clemens, Michael and Jeffrey Williamson. 2002. “Closed Jaguar, Open Dragon:

Comparing Tariffs in Latin America and Asia before World War II.” NBER Working

Paper No. 9401.

Edwards, Sebastian. 1993. “Openness, Trade Liberalization, and Growth in Developing

Countries.” Journal of Economic Literature, 31, 1358-1393

Edwards, Esquivel and Marquez, editors. 2007. Chapter 9: “Some Economic Effects of

Closing the Economy: The Mexican Experience in the Mid-Twentieth Century” by

Gerardo Esquivel and Graciela Marquez

Edwards, Esquivel and Marquez, editors. 2007. Chapter 10: “The Political Economy of

Protectionism: The Mexican Textile Industry, 1900-1950” by Aurora Gomez-Galvarriato

Facchini, Giovanni, Marcelo Olarreaga, Peri Silva and Gerald Willmann. 2007.

“Substitutability and Protectionism: Latin America’s Trade Policy and Imports from

China and India.” CESifo Working Paper No. 1947

Lederman, Daniel, Marcelo Olarreaga and Isidro Soloaga. 2007. “The Growth of China

and India in World Trade: Opportunity or Threat for Latin America and the Caribbean?”

World Bank Policy Research Working Paper No. 4320

Lederman, Daniel and William Maloney. 2008. “In Search of the Missing Resource

Curse.” Economia, Fall, 1-57

Levy-Yeyati, Eduardo. 2012. Latin America Economic Perspectives – All Together Now:

The Challenge of Regional Integration. Brookings Institute. Available free on-line:

http://www.brookings.edu/~/media/research/files/reports/2012/4/latin%20america%20per

spectives/04_latin_america_economic_perspectives.pdf

Manzano, Osmel and Francisco Monaldi. 2008. “The Political Economy of Oil

Production in Latin America.” Economia, Fall, 59-103

United Nations Conference on Trade and Development. 2006. Trade and Development

Report. Available free on-line:

http://unctad.org/en/Docs/tdr2006_en.pdf

Reyes and Sawyer. 2011. Chapter 5: “Latin America and Primary Commodities”

Reyes and Sawyer. 2011. Chapter 7: “Latin America Trade Policy”

Wise, Carol and Cintia Quiliconi. 2007. “China’s Surge in Latin American Markets:

Policy Challenges and Responses.” Politics and Policy, 35 (3), 410-438

Topic 9 – Sources of Growth: Technology, Capital and Labor

Acs, Zoltan and Jose Ernesto Amoros. 2008. “Entrepreneurship and Competitiveness

Dynamics in Latin America.” Jena Economic Research Papers No. 2008-059

Chumacero, Romulo and Rodrigo Fuentes. 2006. “Economic Growth in Latin America:

Structural Breaks or Fundamentals?” Estudios de Economia, 33 (2), 141-154

http://www.brookings.edu/~/media/research/files/reports/2012/4/latin%20america%20perspectives/04_latin_america_economic_perspectives.pdf

http://www.brookings.edu/~/media/research/files/reports/2012/4/latin%20america%20perspectives/04_latin_america_economic_perspectives.pdf

http://unctad.org/en/Docs/tdr2006_en.pdf

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Cole, Harold, Lee Ohanian, Alvaro Riascos and James Schimitz. 2005. “Latin America in

the Rearview Mirror.” Journal of Monetary Economics, 52, 69-107

De Gregorio, Jose, and Jong-Wha Lee. 2004. “Growth and Adjustment in East Asia and

Latin America.” Economia, Fall, 69-134.

De Gregorio, Jose. 2006. “Economic Growth in Latin America: From the Disappointment

of the Twentieth Century to the Challenges of the Twenty-First.” Central Bank of Chile

Working Papers No. 377.

Inter-American Development Bank. 2004. Good Jobs Wanted: Labor Markets in Latin

America: 2004 Report. Available free on-line:

http://idbdocs.iadb.org/wsdocs/getdocument.aspx?docnum=1600276

Loayza, Norman, Pablo Fajnzylber and Cesar Calderon. 2004. “Economic Growth in

Latin America and the Caribbean: Stylized Facts, Explanations and Forecasts.” Central

Bank of Chile Working Paper No. 265

Lora. 2008. Chapter 7: “Rethinking Conventional Wisdom on Job Quality”

OECD. 2013. Latin American Economic Outlook 2013: Small and Medium Enterprises

Policies for Structural Change. Available free on-line:

http://www.oecd-ilibrary.org/development/latin-american-economic-outlook-2013_leo-

2013-en

Reyes and Sawyer. 2011. Chapter 2: “Economic Growth and Latin America”

Solimano, Ramon, and Raimundo Soto. 2005. “Economic Growth in Latin America in

the Late 20th Century: Evidence and Interpretation.” Economic Commission for Latin

American and the Caribbean

Tybout, James. 2000. “Manufacturing Firms in Developing Countries: How Well Do

They Do, and Why?” Journal of Economic Literature, 38, 11-44

Topic 10 – Rural and Urban Development

Cardoso and Helwege. 1992. Chapter 10: “Agrarian Reform”

Cerruti, Marcela and Rodolfo Bertoncello. 2003. “Urbanization and Internal Migration

Patterns in Latin America.” Center of Population Studies, Argentina

Deininger, Klaus and Hans Binswanger. 1999. “The Evolution of the World Bank’s Land

Policy: Principles, Experience, and Future Challenges.” The World Bank Research

Observer, 14 (2), 247-276

Echeverria, Ruben, Eduardo Trigo and Derek Byerlee. 1996. “Institutional Change and

Effective Financing of Agricultural Research in Latin America.” Inter-American

Development Bank and the World Bank.

Field, Erica. 2007. “Entitled to Work: Urban Property Rights and Labor Supply in Peru.”

Quarterly Journal of Economics, November, 1561-1602

Janvry, Alain and Elisabeth Sadoulet. 2002. “Land Reform in Latin America: Ten

Lessons toward a Contemporary Agenda.” World Bank’s Latin America Land Policy

Workshop, Mexico.

Lora. 2008. Chapter 8: “Urban Quality of Life: More Than Bricks and Mortar”

Lora, Eduardo, Andrew Powell, Bernard van Praag, Pablo Sanguinetti, editors. 2010. The

Quality of Life in Latin American Cities: Markets and Perception. Inter-American

Development Bank and the World Bank.

Topic 11 – Poverty and Inequality

Attanasio, Orazio, Erich Battistin, Emla Fitzsimos, Alice Mesnard and Marcos Vera-

Hernandez. 2005. “How Effective Are Conditional Cash Transfers? Evidence from

Colombia.” The Institute for Fiscal Studies, Briefing Note No. 54

http://idbdocs.iadb.org/wsdocs/getdocument.aspx?docnum=1600276



11

Breceda, Karla, Jamele Rigolini and Jaime Saavedra. 2009. “Latin America and the

Social Contract: Patterns of Social Spending and Taxation.” Population and Development

Review, 35 (4), 721-748

Cardoso and Helwege. 1992. Chapter 9: “Poverty”

Edwards, Esquivel and Marquez, editors. 2007. Chapter 3: “Inequality and the Evolution

of Institutions of Taxation: Evidence from the Economic History of the Americas” by

Kenneth Sokoloff and Eric Zolt

Galiani, Sebastian. 2008. “Reducing Poverty in Latin America and the Caribbean.”

Report for the Copenhagen Consensus and the Inter-American Development Bank.

Lopez, Humberto and Gillermo Perry. 2008. “Inequality in Latin America: Determinants

and Consequences.” Inter-American Development Bank, Policy Research Working Paper

No. 4504

Lopez-Calva, Luis and Nora Lustig. 2009. “The Recent Decline of Inequality in Latin

America: Argentina, Brazil, Mexico and Peru.” Manuscript

Lustig, Nora. 2000. “Crises and the Poor: Socially Responsible Macroeconomics.” Inter-

American Development Bank.

McLeod, Darryl and Nora Lustig. 2011. “Inequality and Poverty under Latin America’s

New Left Regimes.” Tulane Economics Working Paper No. 1117

Montecino, Juan. 2011. “Decreasing Inequality under Latin America’s “Social

Democratic” and “Populist” Governments: Is the Difference Real?” Center for Economic

and Policy Research.

United Nations Conference on Trade and Development. 2012. Trade and Development

Report. Available free on-line:

http://unctad.org/en/PublicationsLibrary/tdr2012_en.pdf

Reyes and Sawyer. 2011. Chapter 12: “Poverty and Inequality”

Soares, Rodrigo, Juliano Assuncao and Tomas Goulart. 2012. “A Note on Slavery and

the Roots of Inequality.” Journal of Comparative Economics, 40, 565-580

Thorbecke, Erik and Machiko Nissanke. 2008. “The Impact of Globalization on the Poor

in Latin America.” Economia, Fall, 153-196

Topic 12 – Health and Social Security

Barr, Nicholas and Peter Diamond. 2010. “Reforming Pensions: Lessons from Economic

Theory and Policy Directions.” Economia, Fall, 1-15

Berman, Peter and Thomas Bossert. 2000. “A Decade of Health Sector Reform in

Developing Countries: What Have We Learned?” Harvard School of Public Health.

Bliss, Katherine. 2009. “Health in Latin America and the Caribbean: Challenges and

Opportunities for US Engagement.” Report of the CSIS Global Health Policy Center

Casas, Juan Antonio, Norberto Dachs and Alexandra Bambas. 2001. “Health Disparities

in Latin American and the Caribbean: The Role of Social and Economic Determinants.”

Pan American Health Organization.

Lora. 2008. Chapter 5: “Getting a Pulse on Health Quality”

Rofman, Rafael. 2005. “Social Security Coverage in Latin America.” The World Bank,

Social Protection Discussion Paper No. 0523

Tuesta, David. 2011. “A Review of the Pension Systems in Latin America.” BBVA

Working Paper No. 11/15

http://unctad.org/en/PublicationsLibrary/tdr2012_en.pdf

12

Topic 13 –Education Policy

Angrist, Joshua, Erick Bettinger and Michael Kremer. 2006. “Long-Term Educational

Consequences of Secondary School Vouchers: Evidence from Administrative Records in

Colombia.” American Economic Review, 96 (3), 847-862

Damon, Amy and Paul Glewwe. 2007. “Three Proposals to Improve Education in Latin

America and the Caribbean: Estimates of the Costs and Benefits of Each Strategy.”

Report of the Copenhagen Consensus Center and the Inter-American Development Bank

Lora. 2008. Chapter 6: “Learning about Education Quality and Perceptions”

McEwan, Patrick, Miguel Urquiola and Emiliana Vegas. 2007. “School Choice,

Stratification, and Information on School Performance: Lessons from Chile.” Economia,

Spring, 1-42

Topic 14 – Growth and the Environment

Janssen, Rainer and Dominik Damian Rutz. 2011. “Sustainability of Biofuels in Latin

America: Risks and Opportunities.” Energy Policy, 39, 5717-5725

Reyes and Sawyer. 2011. Chapter 3: “Growth and the Environment in Latin America”