The Political Economy of Development
Summer term 2016
(Note: this lecture is taught in English)
Prof. Christian Bjørnskov, PhD
Tel: 54 - 3853
Fax: 54 - 3649
Office hour: Monday 2-3 pm (Office: 01.019b)
The new political economy and the public choice school contribute to our understanding of not only economic policy, but also long-run economic development. This course takes up a number of topics in development economics in which political economy can provide either another angle or new insights into old issues.
Syllabus Lecture (PDF)
Syllabus Tutorial (PDF)
II. Date and Time
Lecture: June 1, 3, 8, 10, 15, 17, 22, 23, 24, July 6, 8, 13, 15
Wednesday (starting June, 1) 3pm-5pm, AWI room 00.028
Friday (starting June, 3) 1pm-3pm, AWI room 00.028
Exercise: June 7, 9, 14, 16, 28, 29, 30, July, 5, 7, 12, 14, 19, 21
Tuesday (starting June, 7) 4pm-6pm, AWI room 00.028
Thursday (starting June, 9) 2pm-4pm, AWI room 02.036
Exam: July 26, 2-4pm, NUni HS 02
The readings consist of a series of papers, published in international journals.
Teaching will be in English. Make sure to read all papers before the corresponding lecture.
Plans will be made at the first lecture regarding the referee reports.
90-minute exam at the end of the term (90%)
~ 4-5 pages referee report (10%)
In the tutorial sessions, there will be student presentations. Each student (or a group of two student s) will be responsible for a 20 minutes’ presentation and following Q&A and discussions. The presentation is obligatory in order to take part at the exam. For those who have not held the presentation but want to take part at the second exam, please contact Sarah Langlotz.
V. Preliminary lecture plan
1. Introduction and development measurement
Introduction to main problems, topics and data sources
Data sources, Cahill (2005)
Part 1 Main problems of development
2. Long-run growth – Acemoglu and the critics
Acemoglu and Robinson (2006), Albouy (2012)
3. Ideas matter
Mokyr (2005), Denzau and North (1994)
4. Geography matters
Przeworski (2004), Nunn and Puga (2012)
Part 2 Institutional problems
5. Developing democracy?
Aidt and Jensen (2009), Lipset (1959)
6. Property rights
Demsetz (1967), North and Weingast (1989)
7. Culture and trust
Knack and Keefer (1997), Nunn and Wantchekon (2011)
Part 3 The political economy of natural resources and foreign aid
8. Natural resources
Collier and Hoeffler (1998), Tornell and Lane (1999)
9. Effects and side effects of aid
Doucouliagos and Paldam (2009), Knack (2004), Werker et al. (2009)
10. Disbursing aid
Dreher et al. (2008), Brech and Potrafke (2014)
Part 4 Specific problems
Dreher, Kotsogiannis and McCorriston (2009), Bjørnskov (2011)
12. Trade policy
Hillman (1982), Grossman and Helpman (1994)
13. Students’ topic
Last paper to be announced after consultation
VI. Literature list
Acemoglu, Daron and James A. Robinson. 2006. Economic Backwardness in Political Perspective. American Political Science Review vol. 100: 115-131.
Aidt, Toke and Peter S. Jensen. 2009. The Taxman Tools Up: An Event History Study of the Introduction of the Personal Income Tax, 1815-1938. Journal of Public Economics vol. 93: 160-175.
Albouy, David. 2012. The Colonial Origins of Comparative Development: An Empirical Investigation: Comment. American Economic Review vol. 102: 3059-3076.
Bjørnskov, Christian. 2011. Combatting Corruption. Journal of Law and Economics vol. 54: 135‑159.
Brech, Viktor and Niklas Potrafke. 2014. Donor Ideology and Types of Foreign Aid. Journal of Comparative Economics vol. 42: 61-75.
Cahill, Miles. 2005. Is the Human Development Index Redundant? Eastern Economic Journal vol. 31: 1-5.
Collier, Paul and Anke Hoeffler. 1998. On Economic Causes of Civil War. Oxford Economic Papers vol. 50: 563-573.
Demsetz, Harold. 1967. Towards a Theory of Property Rights. American Economic Review vol. 57: 347-359.
Denzau, Arthur T. and Douglass C. North. 1994. Shared Mental Models: Ideologies and Institutions. Kyklos vol. 47: 3-31.
Doucouliagos, Hristos and Martin Paldam. 2009. The Aid Effectiveness Literature: The Sad Results of 40 Years of Research. Journal of Economic Surveys vol. 23: 433-461.
Dreher, Axel, Christos Kotsogiannis and Steve McCorriston, 2009, How do Institutions Affect Corruption and the Shadow Economy? International Tax and Public Finance vol. 16: 773-796.
Dreher, Axel, Peter Nunnenkamp and Rainer Thiele. 2008. Does US aid buy UN General Assembly votes? A Disaggregated Analysis. Public Choice vol. 136: 139–164.
Grossman, Gene M. and Elhanan Helpman. 1994. Protection for Sale. American Economic Review vol. 84: 833-850.
Hillman, Arye. 1982. Declining industries and political-support protectionist motives. American Economic Review vol. 72: 1180-1187.
Knack, Stephen. 2004. Does Foreign Aid Promote Democracy? International Studies Quarterly vol. 48: 251-266.
Knack, Stephen and Philipp Keefer. 1997. Does Social Capital Have an Economic Payoff? A Cross-Country Investigation. Quarterly Journal of Economics vol. 112: 1251-1288.
Lipset, Seymour Martin. 1959. Some Social Requisites of Democracy: Economic Development and Political Legitimacy, American Political Science Review vol. 53: 69-105.
Mokyr, Joel. 2005. Long-term Economic Growth and the History of Technology. In the Handbook of Economic Growth, edited by Philippe Aghion and Steven Durlauf, Amsterdam: Elsevier, 1113-1180.
North, Douglass C. and Barry R. Weingast. 1989. Constitutions and commitment: The evolution of institutions governing public choice in seventeenth-century England. Journal of Economic History vol. 49: 803-832.
Nunn, Nathan and Leonard Wantchekon. 2011. The Slave Trade and the Origins of Mistrust in Africa. American Economic Review vol. 101: 3221-3252.
Nunn, Nathan and Diego Puga. 2012. Ruggedness: The Blessing of Bad Geography in Africa. Review of Economics and Statistics vol. 94 (1): 20-36.
Przeworski, Adam. 2004. Geography vs. Institutions Revisited: Were Fortunes Reversed? Working paper, New York University.
Tornell, Aaron and Philip R. Lane. 1999. The Voracity Effect. American Economic Review vol. 89: 22-46.
Werker, Eric D., Faisal Z. Ahmed and Charles Cohen. 2009. How is Foreign Aid Spent? Evidence from a Natural Experiment. American Economic Journal: Macroeconomics vol. 1 (2): 225-244.