Development Economics 


Objectif

In this course, we will study the role of human capital for economic development from a microeconomic perspective. We will examine decisions made by individuals and households in developing countries, in terms of preferences and constraints. We will learn a lot of facts about the lives of people in developing countries, in particular about the constraints that they face (lack of access to public goods, credit, information, markets, etc.). We will think about the causes and consequences of these constraints, to eventually assess what can be done to improve human capital in poor countries. We will review the evidence on what has been tried, what has been successful and what has failed, and importantly, why. We will see that not all evidence is good and learn how to tell good studies from the bad ones. We will make sure any statement we make in this course has theoretical foundations and is grounded in rigorous empirical evidence. By rigorous evidence, we mean empirical designs in which researchers are able to establish credible causal relationships. 

The intended learning outcomes of this course are the following:

  • Summarize key facts about human capital in developing countries
  • Analyze simple microeconomic models of human capital investment
  • Criticize empirical studies
  • Evaluate policies promoting human capital in developing countries
     

Plan

The course is divided into 3 parts, as detailed below. Each part consists of (i) a lecture and (ii) a discussion prepared and led by the students.

 

Part 1: the returns to education

Lecture: does higher education lead to higher GDP and GDP growth? How large are the returns to education in developing countries? What determines them?
Discussion: what can we learn from field experiments to improve educational policy in developing countries?

 

Part 2: the demand for education

Lecture: why do some children get an education and others do not? How can we model the way parents make educational decisions for their children? Based on the model, what programs can be effective at raising the demand for education?
Discussion: must conditional cash transfers be conditional?  

 

Part 3: gender gaps

Lecture: when/how does discrimination against women happen? Why are women valued less than men? What can be done to reduce gender inequality?
Discussion: is women’s empowerment good for development?

Références

Part 1 – Lecture material

Hanushek, Eric and L. Woessman (2010). Education and Economic Growth.  In: Penelope Peterson, Eva Baker, Barry McGaw, (Editors), International Encyclopedia of Education. volume 2, pp. 245-252. Oxford: Elsevier.

Duflo, E (2001) “Schooling and labor market consequences of school construction in Indonesia: Evidence from an unusual policy experiment”, American Economic Review,Vol: 91 Iss 4,P: 795-813

Ozier Owen (2017) “The Impact of Secondary Schooling in Kenya: A Regression Discontinuity Analysis”, Journal of Human Resources.

 

Part 1 – Discussion material

Deaton, A. 2010. "Instruments, Randomization, and Learning About Development." Journal of Economic Literature, 48(2), 424-55

Banerjee Abhijit and Esther Duflo. 2009. "The Experimental Approach to Development Economics." Annual Review of Economics, 151-178

Ravallion, Martin. 2009. "Should the Randomistas Rule?" The Economists' Voice, 6(2).

Barrett, Christopher B. and Michael R. Carte. forthcoming. "R, "Retreat from Radical Skepticism: Rebalancing Theory, Observational Data and Randomization in Development Economics," Chapter 7 in , Editor,  (, in Press). ," D. L. Teele, Field Experiments and Their Critics. New Haven, CT: Yale University Press

 

Part 2 – Lecture material

Jensen, Robert. 2010. "The (Perceived) Returns to Education and the Demand for Schooling." The Quarterly Journal of Economics, 125(2), 515-48.

Glewwe, Paul and Karthik Muralidharan (2015) “Improving School Education Outcomes in  Developing Countries: Evidence”, Knowledge Gaps, and Policy Implications RISE-WP-15/001

World Development Report (2019) “Learning to realize education’s promise”, overview

Basu Kaushik and Pham Hoang Van (1998) “The Economics of Child Labor”, American Economic Review, 88(3), 412-427

 

Part 2 – Discussion material

Baird, Sarah; Craig McIntosh and Berk Oezler. 2011. "Cash or Condition? Evidence from a Cash Transfer Experiment." Quarterly Journal of Economics, 126(4), 1709-53.

de Brauw, Alan and John Hoddinott. 2011. "Must Conditional Cash Transfer Programs Be Conditioned to Be Effective? The Impact of Conditioning Transfers on School Enrollment in Mexico." Journal of Development Economics, 96(2), 359-70.

de Janvry, A. and E. Sadoulet. 2006. "Making Conditional Cash Transfer Programs More Efficient: Designing for Maximum Effect of the Conditionality." World Bank Economic Review, 20(1), 1-29.

Fernald, Lia C. H.; Paul J. Gertler and Lynnette M. Neufeld. 2008b. "Role of Cash in Conditional Cash Transfer Programmes for Child Health, Growth, and Development: An Analysis of Mexico's Oportunidades." Lancet, 371(9615), 828-37.

 

Part 3 – Lecture material

Amartya Sen, “More Than 100 Million Women Are Missing,” New York Review of Books 37(2), December 20, 1990

Elaina Rose (1999). “Consumption Smoothing and Excess Female Mortality in Rural India.” Review of Economics and Statistics 81, no. 1: 41-49

Nancy Qian (2008). “Missing Women and the Price of Tea in China: The Effect of Sex-Specific Income on Sex Imbalance,” The Quarterly Journal of Economics, 123(3), August 2008.

 

Part 3 – Discussion material

Chattopadhyay, Raghabendra and Esther Duflo. 2004. "Women as Policy Makers: Evidence from a Randomized Policy Experiment in India." Econometrica, 72(5), 1409-43.

Duflo Esther. 2003. “Grandmothers and Granddaughters: Old Age Pension and Intrahousehold Allocation in South Africa”. World Bank Economic Review, 17, 1-25.

Ashraf, Nava, Erica Field, and Jean Lee. 2014. “Household Bargaining and Excess Fertility: An Experimental Study in Zambia.” American Economic Review, 104(7): 2210–2237

Harari Mariaflavia. 2017. “Women’s Iheritance Rights and Bargaining Power: Evidence from Kenya”. Economic Development and Cultural Change, forthcoming.