School of Public Policy

University of Maryland

 

PUAF 698R: Development Challenges in the Globalization Process

Fall 2006

 

 

 

Instructor:                  Professor Carol Graham

Email:                          cgraham@umd.edu or cgraham@brookings.edu

Office Hours:              4113D Van Munching Hall; by appointment

Phone:                         (301) 405-1914 (UMD)

                                    (202) 797-6022 (Brookings)

 

Lectures:                    Mondays, 1:30-4:00 @ 2101 Van Munching Hall

Course Webpage:       http://www.wam.umd.edu/~cgraham/Courses/PUAF698R.html

 

Course Description:

 

This course introduces students to the range of opportunities and challenges that the increasing integration of the world economy poses for developing economies and for their citizens. Topics include: the links between growth, trade, capital market integration, and poverty reduction; the interaction between global economic integration and poverty and inequality trends, both within and among countries; the effects of those trends and the increasing availability of global information on public perceptions of the process; the links between globalization related economic trends and ethnic, religious, and other forms of civil violence; and global public health challenges that result from many of these trends.  The course introduces students to both standard and novel measures for assessing the welfare effects of these trends, and develops their ability to apply those measures to empirical data. Prerequisites: micro and macro economics and/or comparable background courses.

 

Course Objectives:

 

  • To provide a broad overview of the challenges to economic development in poor countries and how they relate to the increasing integration of global trade, capital, and labor markets, and to the diffusion of information technology and of global public health and other public policy challenges across national borders.
  • To learn about the conceptual and measurement challenges involved in accurately assessing these trends and proposing public policy solutions
  • To gain in-depth knowledge of one topic in this broad area, and to apply the tools acquired to a relevant policy question and preferably to the analysis of a primary data set via an individual project/research paper

 

Course Requirements:

 

Performance in this course will hinge on three major elements: broad knowledge of the course materials and topics covered, as gauged by a final exam; participation in the class discussion sessions; and an individual paper and presentation and topic of your choice. Each student will choose a topic by week three of the course. The topic should be analytically tractable and at the same time relevant to some of the current public debates on globalization and development issues. Students will be expected to bring their increasing familiarity with their topics to bear on the more general discussion sessions in class. Each student will also present his/her research and draft paper to the class in a 10-15 minute presentation in the final weeks of the course. Finally, the papers should meet one of the following three objectives:

 

  • Analyze a debate in the field and distinguish between the components of the disagreements that are driven by methodology and those which are driven by either substantive or ideological disagreements. Make a novel contribution to one element of the debate.
  • Conduct original/primary analysis of a data set for a country or set of countries in order to provide empirical support for the argument that you are making. Data can range from economic and/or socio-demographic data available from the World Bank, UN, or other such source, or survey data from a number of sources such as the World Values Survey.
  • Design a viable experiment to analyze the impact of a development intervention based on a randomized trial or similar approach. Short of actually being able to conduct that experiment, describe the context, relevant variables and input, timing, and so forth. Show how the results of such an experiment could contribute in novel ways to our understanding of the topic that you are researching.

 

Late submissions of papers, without valid excuse, will be penalized by a full grade per day. Note also that students are required to abide by the Code of Academic Integrity available on the web at http://www.inform.umd.edu/CampusInfo/Departments/JPO

 

Recommended books:

 

  • William Easterly, The Elusive Quest for Growth: Economists Adventures and Misadventures in the Tropics (Oxford: MIT Press, 2001).
  • Branko Milanovic, Worlds Apart: Measuring Global and International Inequality (Princeton University Press, 2005).  
  • Susan Collins and Carol Graham, Brookings Trade Forum 2004: Globalization, Poverty, and Inequality (Brookings, 2005). (available on line at:  http://muse.jhu.edu – link for Brookings periodicals)
  • Carol Graham and Stefano Pettinato, Happiness and Hardship: Opportunity and Insecurity in New Market Economies (Brookings, 2002).

 

Hand-outs of some of what is in these books will be made available, particularly the chapters in Collins and Graham; used or paperback editions of the others should be available, including from Amazon.

 

 

Course Schedule

 

Week 1 – September 11

Introduction to Course Themes

Discussion of Criteria for Individual Projects

 

Readings:

 

Begin readings for the September 18 discussion. These readings provide essential core knowledge for the methodological approaches covered in the course. Readings are available on the course website.

 

Week 2 – September 18

Selection of Analytical Tools for Individual Projects

Measurement Issues and Challenges

Cross Country Regressions – Promises and Pitfalls

Novel Approaches to Assessing Development Outcomes: Survey Research, Randomized Trials, Experiments

Finding Appropriate Data sets

 

Readings:

 

·         Angus Deaton and Valerie Kozel, “The Great Indian Poverty Debate”, World Bank Research Observer, Vol. 20, No.2, Fall 2005.

·         Carol Graham, “The Economics of Happiness: Insights on Globalization from a Novel Approach”, World Economics, Vol.6, no.3, July-Sept 2005 (handout).

·         Bertrand, Marianne and Sendhil Mullainathan (2004) “Are Emily and Greg More Employable than Lakisha and Jamal? A Field Experiment on Labor Market Discrimination”, NBER working paper 9873 (available at http://post.economics.harvard.edu/faculty/mullainathan/papers/emilygreg.pdf) (also published in the American Economic Review)

·         Paul Glewwe and Michael Kremer, “Schools, Teachers, and Education Outcomes in Developing Countries”, Chapter in the Handbook on the Economics of Education, forthcoming (handout). [Skim and then pay particular attention to section III on methodological issues.]

·         Esther Duflo, “Remedying Education”, available at: http://econ-www.mit.edu/faculty/download_pdf.php?id=677

 

Week 3 – September 25

Why the Best Intentions Have Failed: Development Challenges and Foreign Aid

 

Readings:

 

·         William Easterly, The Elusive Quest for Growth: Economists Adventures and Misadventures in the Tropics (Oxford: MIT Press, 2001).

·         Carol Graham and Michael O’Hanlon, “Making Foreign Aid Work”, Foreign Affairs, Vol. 76, No.4, July/August 1997.

·         Nancy Birdsall, Dani Rodrik, and Arvind Subramanian, “How to Help Poor Countries”, Foreign Affairs, July-August 2005 (also available at www.cgdev.org )

 

Week 4 – October 2

Globalization, Poverty, and Inequality

 

·         Branko Milanovic, Worlds Apart: Measuring Global and International Inequality (Princeton University Press, 2005).  

·         Martin Ravallion, “Competing Concepts of Inequality in the Globalization Debate” in Collins and Graham, eds., Brookings Trade Forum 2004 (hand-out).

·         William Easterly, “Channels from Globalization to Inequality: Productivity World Versus Factor World” in Collins and Graham, ed., Brookings Trade Forum 2004 (hand-out).

 

Week 5 – October 9

Growth, Convergence, and Poverty Reduction

 

·         David Dollar, “Globalization, Poverty, and Inequality Since 1990”, World Bank Research Observer, Vol.20, No.2, Fall 2005.  (hand-out)

·         Kenneth Rogoff, “Some Speculation on Growth and Poverty over the Twenty-First Century”, in Susan Collins and Carol Graham, Brookings Trade Forum 2004: Globalization, Poverty, and Inequality (Brookings, 2005).

·         Angus Deaton, “Measuring Poverty I a Growing World (or Measuring Growth in a Poor World”, NBER Working Papers 9822, National Bureau of Economic Research (available at www.nber.org )

·         Nancy Birdsall and Augusto de la Torre, Washington Contentious: Economic Policies for Social Equity in Latin America (Carnegie Endowment/Inter-American Dialogue, 2001). Available on line at: http://www.cgdev.org/content/publications/detail/2923 (read the summary only if time is limited)

 

Week 6- October 16

Dynamic Conceptualizations of Poverty and Inequality:

Opportunity, Insecurity, and Subjective Well Being

Class Debate on National Indicators Proposal

 

·         Carol Graham and Stefano Pettinato, Happiness and Hardship: Opportunity and Insecurity in New Market Economies (Brookings, 2002).

·         Ed Diener, “Challenges for National Indicators of Well-Being and Ill-Being”, Social Indicators Network News,  Number 84, November 2005. (hand-out)

 

Week 7 – October 23

Macro Regime Choices: Trade, Capital Markets, and Exchange Rates Regimes

 

·         Obstfeld, Maurice and Kenneth Rogoff, “The Mirage of Fixed Exchange Rates”, Journal of Economic Perspectives, Vol.9, Fall 1995. (available from Jstor)

·         Penelopi Goldberg and Nina Pavnick, “Trade, Inequality, and Poverty: What Do We Know? Evidence from Recent Trade Liberalization Episodes in Developing Countries” in Collins and Graham, eds., Brookings Trade Forum 2004.

·         Wiliam Cline, “Financial Crises and Poverty in Emerging Market Economies”, Center for Global Development, Working Paper #7, June 2002. Available at www.cgdev.org .

·         Jere Behrman, Nancy Birdsall, and Miguel Szekely, “Economic Reform and Wage Differentials in Latin America”, Working Paper 435. Washington, D.C.: Inter-American Development Bank (www.iadb.org ) .

 

Week 8 – October 30

Joining the Global Economy: Market Reforms and Regime Transitions

 

·         John Williamson, “In Search of a Manuel for Technopols”, in J. Williamson, ed., The Political Economy of Policy Reform (Washington, D.C.: IIE, 1994). (handout).

·         Eduardo Lora and Mauricio Olivera, “The Electoral Consequences of the Washington Consensus”, Economia, Vol. 5, No.2, Spring 2005 (available on line at http://muse.jhu.edu – look for Brookings periodicals).

·         Carol Graham and Sandip Sukhtankar, “Does Economic Crisis Reduce Support for Market Reforms in Latin America? Some Evidence for Surveys of Public Opinion and Well Being”, Journal of Latin American Studies, Vol. 36, 2004. (hand-out)

·         Clifford G. Gaddy and Barry W. Ickes, “Russia’s Virtual Economy,” Foreign Affairs, September/October 1998. (available at: www.brookings.edu/views/articles/gaddy/199806.htm)

 

Week 9 – November 6

Global Public Health / Global Labor Market Issues

 

·         Angus Deaton, “Health in an Age of Globalization” in Collins and Graham, eds., Brookings Trade Forum, 2004.

·         Ruth Levine and the What Works Working Group with Molly Kinder, Millions Saved: What Works With Global Health Interventions”, CGD Policy Brief,  November 30, 2004. Available at www.cgdev.org

·         Summary/introduction to Brookings Trade Forum 2006 by Susan Collins and Carol Graham, available at www.brookings.edu – go to Economic Studies/Brookings Trade Forum

·         Lant Pritchett paper for May 2006 Brookings Trade Forum, “Boom Towns and Ghost Countries”, available at www.brookings.edu – go to Economic Studies/Brookings Trade Forum

Week 10 – November 13

Development Failures and Civil Violence – Are There Linkages?

 

·         Nicholas Sambanis, “Poverty and the Organization of Political Violence”, in Collins and Graham, eds., Brookings Trade Forum 2004.

·         Joshua Epstein, John D. Steinbruner, and Miles T. Parker, “Modeling Civil Violence: An Agent-Based Computational Approach”, Center on Social and Economic Dynamics Working Papers, No. 20, The Brookings Institution, Washington, D.C., January 2001. Available at www.brookings.edu/es/dynamics . Also available in the Proceedings of the National Academy of Sciences.

·         Timothy R. Gulden, “Spatial and Temporal Patterns in Civil Violence: Guatemala 1977-1986”, Center on Social and Economic Dynamics Working Papers, No. 26, The Brookings Institution, February 2002. Available at www.brookings.edu/es/dynamics .

·         John Steinbruner, “Containing Civil Violence”, Chapter 4 in Principles of Global Security (also by Steinbruner) (Brookings, 2000). [Optional background reading]

 

Week 11 – November 20

Foreign Aid Revisited – Can We Save the World? – Class Debate

 

·         Jeffrey Sachs, “A Global Compact to End Poverty”, World Economics, Vol. 6, No.4, October-December 2004 (hand-out – on course website).

·         William Easterly and Ross Levine, “Tropics, Germs, and Crops: How Endowments Influence Economic” CGD Working Paper 15, October 2002. www.cgdev.org

·         Michael Kremer, “Randomized Evaluations of Educational Programs in Developing Countries: Some Lessons” American Economic Review 93(2), May 2003, pp. 102-106. (hand-out)

 

Week 12- November 27

In-Class Final Exam

 

Week 13- December 4

Individual Project Presentations

 

Week 14 – December 11

Individual Project Presentations

 

Final Paper Due December 15

NO MORE THAN 20 Pages in length

 

 

 

IMPORTANT MESSAGE FROM THE STUDENT COUNCIL:

 

The University of Maryland, College Park has a nationally recognized Code of Academic Integrity, administered by the Student Honor Council.  This Code sets standards for academic integrity at Maryland for all undergraduate and graduate students.  As a student you are responsible for upholding these standards for this course.  It is very important for you to be aware of the consequences of cheating, fabrication, facilitation, and plagiarism. For more information on the Code of Academic Integrity or the Student Honor Council, please visit http://www.shc.umd.edu.

 

To further exhibit your commitment to academic integrity, remember to sign the Honor Pledge on all examinations and assignments: "I pledge on my honor that I have not given or received any unauthorized assistance on this examination (assignment). "