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A person gets for which it struggles.

(Al Quran)

Course Information
Program: M. Phil. Economics
Course: Development Economics
Semester: Fall 2019
Credit Hrs: 03
Assessment: Quiz: 10%, Assignment: 10%,
Attendance: 5%
Mid Term Exam: 25%, Final Exam: 50%
Course Instructor: Dr. Ghulam Rasool Madni
grmadni1@gmail.com

Course Description
Economic development can be described as a process of structural change that facilitates a
sustained rise in the living standards of the population as a whole. This course will use all the
skills you have developed as an economist to try and answer important economic questions to
improve the lives of humanity. Providing an answer is hard because solving the problem of
world poverty is not as simple as reallocating income. It would take $511 billion a year to
increase the incomes of the poorest to just $2 a day, but calculated in 2003 the G7 countries
aspire to give (but do not quite) just $142 billion a year in aid. The goal of this course is to better
understand the lives of the world’s poor. What are their lives like? Why do they remain poor?
Specifically, what price distortions and market failures hinder their quest to improve their well-
being? Is there scope for policy to help the world’s poor?

Course Learning Outcomes


Each lecture will be structured to provide the necessary theory to understand the topic discussed,
as well as an empirical assessment of its relevance. On successful completion of this course,
students will be able to:

1. Demonstrate familiarity with some central themes and issues of economic development.
2. Demonstrate the understanding of the difference between growth and development, major
growth theories, the measurement of inequality, significance of agriculture in developing
countries, poverty and population issues facing the world, and importance of foreign aid.
3. Explain the economic characteristics of developing countries and compare a range of
perspectives on the causes and potential achievement of sustained economic growth and
poverty reduction.
4. Analyze empirical evidence on the patterns of economic development.
5. Read critically the journal literature in the area of economic development.

Proposed Texts
 Thirlwall, A. P. (2006), Growth and Development (Ninth Edition) Palgrave-Macmillan.
 Debraj Ray (1998), Development Economics (Latest Edition) Princeton University Press.
 Sen A.K. (1999) Development as Freedom, Oxford University Press.
 Douglass C. North (1990) Institutions, Institutional Change and Economic
Performance, Cambridge University Press, UK.
 Douglass C. North (2005) Understanding the Process of Economic Change, Princeton
University Press, New Jersey.
 Douglass C. North (2009) Violence and Social Orders, Cambridge University Press, UK.
 The World Bank (2005) World Development Report 2006: Equity and Development,
Oxford University Press.

Note: Numerous articles from different sources will also be used and posted during the course.

Tentative Course Outline:


Week Topics
1 Evolution of Development Views
 Traditional View
 Modern View
 Capability Approach
Source: Sources: Growth and Development Ch:1, Development Economics Ch:2
2 Development Economics and Issues
 Growth vs. Development
 Faces of Underdevelopment
 Structural Features of Development
Sources: Growth and Development Ch:1, Development Economics Ch:2
3 Poverty, Income Distribution and Development
 Measures of Inequality
 Measuring Poverty
 Tackling Poverty
Sources: Growth and Development Ch: 2, Development Economics Ch:6, 7, 8
Banerjee, A.V. and Duflo, E. (2007). The Economic Lives of the Poor. The Journal of
Economic Perspectives. 21(1):141–167

4 Growth and Development in East Asia


 Pattern of Development
 Structural Changes
 Market Friendly Approach
Sources: World Bank (1993). The East Asian Miracle: Economic Growth and Public
Policy
5 East Asian Miracle
 Model of East Asia Growth
 Lessons for LDC’s
 Growth without Development
Sources: World Bank (1993). The East Asian Miracle: Economic Growth and Public
Policy
Krugman P (1994). The Myth of Asia’s Miracle Foreign Affairs; 73, 6.
Stiglitz J. (1996). Some Lessons from East Asian Miracle. The World Bank Research
Observer, vol. 11, no. 2. pp. 151-77

6 Economic Growth Models


 Harrod-Domar Model
 Solow Growth Model
Sources: Growth and Development Ch: 5, Development Economics Ch:3, 4
7 Role of Agriculture for Development
 Barriers to Agricultural Development
 Land Reforms
 Interdependence of Agriculture and Industry
Sources: Growth and Development Ch: 6, Development Economics Ch:11, 12
Janvry A. (2009). Agriculture for Development: New Paradigm and Options for
Success. Leonard Elmhirst Lecture at the 27th IAAE Triennial Conference, China
8 Industrial Development
 Rural- Urban Migration
 Basis for Revolution
 Role of Capital for Development
Sources: Growth and Development Ch: 6,7
9 Human Development and Capabilities
 HRD and its Components
 Population vs. Development
 Theory of Demographic Transition
Sources: Human Development Report (2016),
Ranis G & Stewart F (2000). Strategies for Success in Human Development. Journal
of Human Development. Vol.1. No.1. 49-69.
10 Why Nations Fail?
 Theories that Don’t Work
 Leaders Ineligibility
Sources: Acemoglu D & Robinson J.A. (2012). Why Nations Fail. Grown
Publishers, New York. Ch: 2,3.
11 Institutions for Development
 What are Institutions?
 Formal Rules
 Informal Norms
Sources: Institutions, Institutional Change and Economic Performance. Ch: 1, 5,6
12 Understanding the Process of Economic Change
 Ergodic World
 Non-Ergodic World
 Human Intention
Sources: Understanding the Process of Economic Change, Ch:1,2
13 Development through Social Orders
 Limited Access Social Order
 Open Access Social Order
Sources: Violence and Social Orders, Ch: 1,2.

14 Development through Social Orders


 Different Types of States
 Typology of these states
Sources: Violence and Social Orders, Ch: 3,4.
Expectations from Students
 You are expected to be at each class.
 No alternative exam or quiz shall be taken if a student missed an exam or quiz.
 Assignments will not be collected after the due date.
 Students must turn their cell phones “off” in the class room
 Breaches of academic standards or plagiarism will result in “F” grade.
 Any student can be removed from the class where behavior is deemed inappropriate or disruptive.

I wish you an enjoyable course and successful semester.