PREVIEW: Economic Growth in Historical Perspective: U.C. Berkeley: Spring 2020
After hearing Ellora Derenoncourt rave about being a TA for Melissa Dell and her Econ 142: The History of Economic Growth, I have decided to go full parasite and stand up my own version of the course for the spring of 2020 here at U.C. Berkeley. Tell me what you think! Here are my notes so far:
Course to be at: Teaching Economics: https://delong.typepad.com/teaching_economics/econ-135.html
Econ 135: Economic Growth in Historical Perspective
This course examines the idea and reality of economic growth in historical perspective, beginning with the divergence between human ancestors and other primates and continuing through with forecasts for the 21st century and beyond. Topics covered include human speciation, language, and sociability; the discovery of agriculture and the domestication of animals; the origins and maintenance of gross inequality; Malthusian economies; the commercial and industrial revolutions; modern economic growth; international prosperity differentials; OECD convergence and East Asian miracles; the political economy of growth and stagnation; and the stubborn persistence of poverty.
Assessment: Students are graded on the basis of five two-page triweekly response papers about the readings (20 points; 4 each), five triweekly problem sets (20 points; 4 each), two midterms (40 points; 20 each), in-class exercises (20 points, 1 point per class up to a maximum of 20), section exercises (1 point each), and section and lecture participation (10 points).
Jan 14: Introduction: Economic Growth in Historical Perspective, Human Beings and Their Economies
Jan 21: The Broad Sweep: Herding and Agriculture, Long Run Economic Growth and Stagnation, Growth Theory Basic Building Blocks, The Beginning of Modern Economic Growth, Modern Economic Growth and U.S. Economic Ascendency, Late Nineteenth Century Globalization/Retreat, Convergence and Its Absence, Why Did Sustained Growth Spread to Some Places and Not Others?, The Concentration of Wealth, The Flap of the Butterfly Wing
Feb 25: Midterm 1
Feb 27: A Tour of the Continents: Europe, The Americas, Long Run Economic Development in Asia and Africa, Behind the Iron Curtain, East Asian Miracles
Mar 17 Scattered Issues: Geography and Economic Growth, Growth and Fluctuations, Global Warming and Poverty, Trade and Development, Foreign Military Intervention, Foreign Aid, Kleptocracy and Organized Crime
Apr 16: Midterm 2
Apr 21: What We Know: The Pace of Economic Growth, The Meaning and Measurement of Economic Growth
Apr 28: The Future:
Apr. 30: Review Q&A
OVERVIEW: Malthusian Eras and After: Gregory Clark (2005): The Condition of the Working Class in England, 1209-2003; Ian Morris (2010): Why the West Rules–For Now, Chapter 3 "Taking the Measure of the Past”. An overview of economic growth across time. How did people live in the past? For how long were the bulk of people living on about 2 dollars a day? When did this stop? How much economic growth has there been, and when did it take place?
The International Context Since the Industrial Revolution: Lant Pritchett (1997): Divergence, Big Time. An overview of post-1800 economic growth across space. How differently do people live depending on where they happen to live today? Where did these absurd differentials come from? When did these absurd differentials emerge?
The Uncertain Pace of Growth: William Nordhaus: Do Real-Output and Real-Wage Measures Capture Reality? What do we mean by saying that economic growth has been 2% per year for the past century and a half? What errors do we make when we try to squash a multidimensional process down into one single number?
THE EAST AFRICAN PLAINS APE: Gift-Exchange and Human Sociability: Paul Seabright: In the Company of Strangers; Joseph Henrich (2016): The Secret of Our Successes: How Culture is Driving Human Evolution, Domesticating Our Species, and Making us Smarter. Chapters 1-5. You cannot have a society with more than one silverback gorilla, or more than ten male chimpanzees. Yet we have a largely-peaceful cooperative division of labor across the globe that puts pretty much everybody within, well, six degrees of economic exchange separation. Why do we do this? How do we do this? What does this tell us about economic growth?
Market Economies and the Division of Labor: Avinash Dixit: Economics: A Very Short Introduction; Adam Smith (1776): An Inquiry into the Nature and Causes of the Wealth of Nations. How much of our current wealth depends on our societal division of labor? How do we keep our current division fo labor going? How do we keep adjusting it—and how successful are we at doing so?
THE BROAD SWEEP: Malthusian Eras: Herding and Agriculture: Jared Diamond (1997): The Worst Mistake in the History of the Human Race; Jared Diamond (1997): Guns, Germs and Steel, chapter 4 pp. 85-92. What caused the transition to farming and herding and what were its consequences? In what sense was it, as Jared Diamond maintains, a huge mistake? For whom was it a huge mistake?
Patriarchy and the Upper Class: Daron Acemoglu and James Robinson (2012): Why Nations Fail, chapter 5 “Growth under Extractive Institutions” sections 1-3; The Man Who Saw All Things (Gilgamesh). Once we have herds and farms, we get gross inequality. How? And how does this maintain itself? Gilgamesh puts his pants on one leg ago a time like the rest of us, doesn't he?
Basic Growth Theory: David Weil (2005): Economic Growth, chapters 1 and 2. Basic theoretical building blocks: The Solow growth model. The poverty trap model. The role of resource scarcity. Determinants of the rate of inventive activity. Positive- and negative-sum entrpreneurship
High Civilization without a Technological Focus: The Maya: Daron Acemoglu and James Robinson (2012): Why Nations Fail, chapter 5 “Growth under Extractive Institutions” Section 4; Simon Martin and Nikolai Grube (2000): Chronicle of the Maya Kings and Queens: Deciphering the Dynasties of the Ancient Maya, Introduction pp. 6-23, Tikal pp. 24-53, Palenque pp. 154-175, Copan, pp. 190-213; David L. Webster (2002): The Fall of the Ancient Maya, chapters 7 and 10. Why was economic growth not sustained at a faster pace for thousands of years after the Neolithic Revolution? People were smart, no, and there was low-hanging fruit, no? Why did a world of more than 2 dollars a day have to wait until post-1800? Looking at one western hemisphere case study
High Civilization without a Technological Focus: The Ancient Central Mediterranean: Karl Polanyi: Aristotle Discovers the Economy; Moses Finley: The Ancient Economy; Aelius Aristides: The Roman Oration; Willem M. Jongman (2007): Gibbon was Right: The Decline and Fall of the Roman Economy https://delong.typepad.com/jongman-gibbon-was-right.pdf; Ian Morris (2004): Economic Growth in Ancient Greece; Peter Temin: The Roman Market Economy. Why was economic growth not sustained at a faster pace for thousands of years after the Neolithic Revolution? People were smart, no, and there was low-hanging fruit, no? Why did a world of more than 2 dollars a day have to wait until post-1800? Looking at one eastern hemisphere case study
THE BROAD SWEEP: Post-Malthusian: Beginnings of Modern Economic Growth: Western Europe: David Landes (2006): Why Europe and the West? Why Not China?; Joel Mokyr (1990): The Lever of Riches, chapter 5 “The Years of Miracles”. Why did sustained economic growth begin when it did? There are many theories about why the remarkable economic growth that has characterized the past 200 years began when and where it did.
Beginnings of Modern Economic Growth: Britain: Daron Acemoglu and James Robinson (2012): Why Nations Fail, chapter 7 “The Turning Point”; Robert Allen: The British Industrial Revolution in Comparative Perspective. Why did sustained economic growth begin in England and not elsewhere? What processes were arithmetically and algebraically necessary to break out of the Malthusian poverty trap? There are many theories about why the remarkable economic growth that has characterized the past 200 years began when and where it did. Which ones are live? Which ones are worth betting on at low odds?
What-If?: Without the Industrial Revolution: What would a Gunpowder-Empire Present Look Like?
1870 as the Inflection Point: The further more than fourfold acceleration of economic growth that took place around 1870. How? Why? What difference did it make for human societies?
What-If?: Without the Acceleration to Modern Economi Growth: What would a Steampunk Present Look Like?
America Takes the Lead: Claudia Goldin and Lawrence Katz: The Race Between Education and Technology; David Donaldson and Richard Hornbeck: Railroads and American Economic Growth: A Market Access Approach. The world's leading growth pole jumps the Atlantic in the years after 1870. Why did the U.S. industrialize rapidly starting in the nineteenth century? Why did some parts of the U.S. industrialize earlier than others?
Characterizing Modern Economic Growth: The algebra of leading sectors
American Slavery: Fred Bateman and Thomas Weiss (1981): A Deplorable Scarcity: The Failure of Industrialization in the Slave Economy. Why did some parts of the U.S. industrialize earlier than others? What role did slavery and its legacy play in U.S. economic growth?
1850-1914 Globalization and Prosperity Advance: W. Arthur Lewis (1978): Evolution of the International Economic Order; Guillaume Daudin et al.: Globalization 1870-1914; Barry Eichengreen (2008): Globalizing Capital: A History of the International Monetary System; Karl Marx and Friedrich Engels (1848): The Communist Manifesto; Norman Angell (1909): Europe's Optical Illusion. For the first time, economies find their standards of living determined by things happening far away. How do people and societies cope with the first globalized economy?
The Development of Underdevelopment Outside the North Atlantic: A number of what-if scenarios
1900-1935 Globalization and Prosperity Retreat: Vladimir Lenin (1902): What Is to Be Done?; John Maynard Keynes (1919): The Economic Consequences of the Peace; John Maynard Keynes (1924): The End of Laissez Faire; Karl Polanyi (1944): The Great Transformation; George Orwell (1936): The Road to Wigan Pier; Ernest Gellner (1973): Scale and Nation. The global market economy fails to deliver the Polanyian rights to community stability, "fair" incomes, and consistent employment that people think they have. And so society strikes back—profoundly stupidly—against the globalized classical liberal order.
The Absence of Convergence: J. Bradford DeLong (1986): Productivity Growth, Convergence, and Welfare; Lant Pritchett (1997): Divergence, Big Time. Post-1870—hell, post-1800—there were no longer major physical impediments to the rapid flow of ideas, machines, and people across the globe. So geographical differences in prosperity levels were rapidly ironed out, right? WRONG!!
Growth Breakthroughs: Robert Allen: Global Economic History: A Very Short Introduction. What had to go right for countries to gain or maintain a place among global prosperity leaders?
Poverty Traps: Aart Kraay and David McKenzie (2014): Do Poverty Traps Exist? Assessing the Evidence. Could countries that were not among global prosperity leaders escape their relative poverty? If yes, why did so few do so? If no, how did the few that managed do it?
Geography: Jeffrey D. Sachs (2003): Institutions Don't Rule: Direct Effects of Geography on Per Capita Income; Jared Diamond (1997): Guns, Germs and Steel, chapter 4 pp. 85-92; Melissa Dell et al. (2009): Temperature and Income: Reconciling New Cross-Sectional and Panel Estimates. How much was and is your prosperity predetermined by your geography?
Institutions: Daron Acemoglu, Simon Johnson, and James Robinson (2006): Institutions as a Fundamental Cause of Long-Run Growth. Nearly all today agree that it is easier to move people to where the good economic-growth institutions are than to move good institutions to where the people are. But what are these "good institutions", exactly? And how can they be hard to move in a world of lightning-speed high-bandwidth communication?
Culture: Nathan Nunn (2012): Culture and the Historical Process. What do we mean when we say thinks like "culture has a profound influence on prosperity?
Plutocracy: Industrial-Society Birth Pangs: Karl Marx and Friedrich Engels (1848): The Communist Manifesto; Karl Marx (1849): Wage-Labor and Capital. Why and how did inequality rise wherever industrial civilization took hold?
Plutocracy: Broad Patterns: Thomas Piketty: Capitalism in the Twenty-First Century. We have seen one and a half enormous waves of within-nation inequality since the start of the Industrial Revolution: within-nation inequality advances, retreats, and advances again. How did this happen?
Plutocracy: The Second Gilded Age: Paul Krugman (2014): Why We’re in a New Gilded Age. Drilling down into the post-1980 return of Gilded Age-class inequality in the North Atlantic.
Path Dependence in the Small and the Large: Paul David (1985): Clio and the Economics of QWERTY; Melissa Dell (2015): Path Dependence in Development: Evidence from the Mexican Revolution; Hoyt Bleakley and J. Lin (2012): Portage and Path Dependence. The Flap of the Butterfly Wing: Path dependence and economic development: Many of the studies considered thus far examine how major ways in which societies were organized historically can have important long-run consequences for economic growth. To what extent do smaller, typically inconsequential events have important long-run impacts? How much should our view of the world be one in which the influence of history can be very non-linear and highly persistent?
A Tour of the Continents: Reversal of Fortune?: Daron Acemoglu etc al., (2002): Reversal of Fortune: Geography and Institutions in the Making of the Modern World Income Distribution. _Hangzhou, Delhi, Baghdad, Cairo, perhaps Tenochtitlan—if you had had to bet in 1300 where the economic capital of the world would be in the late-20th century, you would have bet on one of these, not New York. It did not happen. Why not?
Europe: Britain: Joel Mokyr: The Lever of Riches, chapter 10 “The Industrial Revolution: Britain and Europe”. Looking back in much more detail at the boom in the supply of labor-saving coal-using technologies in Britain, and what followed from that
Europe: France: Daron Acemoglu et al. (2009): The Consequences of Radical Reform: The French Revolution. Feedback from the fall of France's Ancien régime to economic development.
Europe: the Rest of the Continent: Daron Acemoglu and James Robinson (2006): Economic Backwardness in Political Perspective. Once the trail to industrialization is blazed, how does the fact that followers can see where to go but are not there help or hinder?
The Americas: Bad Institutional Luck?: Melissa Dell (2010): The Persistent Effects of Peru's Mining Mita. Why is the U.S. much richer than Latin America? Why are some places in Latin America so much poorer than others? Does inequality play a role in explaining these income differences? What about other differences in historical institutions?
The Americas: Bad Factor Endowment Luck?: Stanley Engerman and Kenneth Sokoloff (2002): Factor Endowments, Inequality, and Paths of Development Among New World Economics. How and when and how much can a prosperous past be a burden? How general a phenomenon is the "resource curse"?
The Americas: Toward a Synthesis: John Coatsworth (2008): Inequality, Institutions and Economic Growth in Latin America; John Coatsworth (2005): Structures, Endowments, and Institutions in the Economic History of Latin America. What are the prospects for Latin American convergence in get net fifty years?
Africa: Slavery: Daron Acemoglu and James Robinson (2010): Why is Africa Poor?; Nathan Nunn: The Long Term Effects of Africa's Slave Trades; Nathan Nunn and Leonard Wantchekon (2011): The Slave Trade and the Origins of Mistrust in Africa. Africa is the world's biggest economic development emergency. It is tempting to blame slavers and slavery. But African retardation relative to the other non-North Atlantic economies is a post-1950 phenomenon. How do we make sense of this?
Africa: Geography: Nathan Nunn, and D. Puga (2012): Ruggedness: The Blessing Of Bad Geography in Africa. Does geography still matter for Africa?
Africa: Colonialism: S. Michalopoulos and E. Papaioannou (2014): National Institutions and Subnational Development in Africa. Colonial boundaries and African retardation
Southeast Asia: Melissa Dell et al. (2015): State Capacity, Local Governance, and Economic Development in Vietnam; Anthony Reid (1993): Southeast Asia in the Age of Commerce, 1450-1680, chapter 1 “The Age of Commerce, 1400-1650”, chapter 4 “Problems of the Absolutist State”, chapter 5 “Origins of Southeast Asian Poverty”. The burden and the blessing of a noble-bureaucratic past
The Middle East: Sevket Pamuk (2014): Institutional Change and Economic Development in the Middle East, 700-1800. State, society, and economy in the Islamic world
Behind the Iron Curtain: Really Existing Socialism?: Karl Marx and Friedrich Engels (1848): The Communist Manifesto; Vladimir Lenin (1902): What Is to Be Done?; Rosa Luxemburg (1918): The Russian Revolution; Richard Ericson: The Classical Soviet-Type Economy: Nature of the System and Implications for Reform. Why was Lenin so sure central planning was the way to go? Why did it work so badly? Lots of highly productive corporations are centrally-planned economies, after all
Is Russia a North Atlantic Economy?: Robert Allen (2011): The Rise and Decline of the Soviet Economy. Is Russia a North Atlantic economy that has done badly or a non-North Atlantic economy that has done well?
World War II and the Value of Magnitogorsk:
After the Fall: Simeon Djankov (2015): Russia's Economy under Putin: From Crony Capitalism to State Capitalism. If you could drive to Frankfurt and back in a day, you did well after 1991. Elsewhere, not. Why?
East Asian Miracles: Background and Foundations: Peter Evans (1995): Embedded Autonomy: States and Industrial Transformation, chapter 1; Dwight Perkins (2013): East Asian Development: Foundations and Strategies, chapter 3 “Government Interventions versus Laissez-Faire in Northeast Asia.
Taiwan and Korea: Dani Rodrik: Getting Interventions Right: How South Korea and Taiwan Grew Rich
The Central Country: Yingyi Qian; Xiaodong Zhu (2012): Understanding China’s Growth: Past, Present and Future.
When Will the Asian Century Begin?:
SCATTERED ISSUES: Secure Property Rights and Growth:
Mafiyas: Charles Tilly (1974): Forward to A. Blok: The Mafia of a Sicilian Village, 1860-1960: A Study of Violent Peasant Entrepreneurs; Melissa Dell (2015): Trafficking Networks and the Mexican Drug War; D. Gambetta (1996): The Sicilian Mafia: The Business Of Private Protection, chapter 1.
The Past and Future of Manufacturing Export-Led Growth:
Growth and Fluctuations: The Great Depression and World War II: John Maynard Keynes (1926): The Economic Consequences of Mr. Churchill; Christina D. Romer (2013): Lessons from the Great Depression for Policy Today; John Maynard Keynes (1931): Unemployment as a World Problem; Taylor Jaworski and Price Fishback (2014): World War II
Growth and Fluctuations: The Asian Crisis of 1998 and the Great Recession of 2009: Andrew Berg: The Asian Crisis; Philip Lane: The European Sovereign Debt Crisis; Lawrence Summers: Reflections on the ‘New Secular Stagnation Hypothesis
Global Warming: Melissa Dell et al. (2012): Temperature Shocks and Economic Growth: Evidence from the Last Half Century. How is global warming impacting economic growth?
Global Warming and Global Poverty: Melissa Dell et al. (2014): What Do We Learn from the Weather? The New Climate-Economy, sections 1 and 3. Does it differentially impact poorer countries? Will it increase conflict?
Soft-Power Pressure, Neo-Imperialism, and Growth: Melissa Dell and Pablo Querubin (2016): Nation Building in Vietnam; C. Appy (2015: The Vietnam War and Our National Identity; A. Dube et al. (2011): Coups, Corporations, and Classified Information. What are the impacts of foreign military intervention on governance, civic society, and economic development? Can a state be built in a weakly institutionalized society through military intervention, or is such an approach likely to backfire? How does politics in the intervening country impact how foreign interventions are conducted? We examine these questions in the context of one of the largest foreign nation-building interventions of the past century: the Vietnam War.
Foreign Aid: Nathan Nunn and Nancy Qian (2014): U.S. Food Aid and Civil Conflict; Alberto Alesina and David Dollar (2000): Who Gives Foreign Aid to Whom and Why? Can foreign aid be an effective means of promoting economic growth? This lecture will consider a range of evidence, from the Marshall Plan and economic aid to East Asia in the 1950s to food aid today.
Technical Assistance: J.A. Yage (1988): Transforming Agriculture in Taiwan: The Experience of the Joint Commission on Rural Reconstruction, chapter 1.
Trade and Geopolitics: D. Berger era al. (2013): Commercial Imperialism? Political Influence and Trade During the Cold War.
Investment and Development: H.W. Singer (1950): The Distribution of Gains Between Investing and Borrowing Countries.
Trade and Development:
Value Chains and Development: D. Atkin (2014): Endogenous Skill Acquisition and Export Manufacturing in Mexico
Value Chains and Growth
The Information Age:
WHAT WE KNOW: The Pace of Economic Growth:
The Meaning and Measurement of Economic Growth:
The Twentieth Century: Andrea Boltho and Gianni Toniolo: The Assessment: The Twentieth Century.
The Near-Term Future of Economic Growth: The North Atlantic: Robert Gordon: The Turtle’s Progress
The Near-Term Future of Economic Growth: The World: Dani Rodrik (2013): The Past, Present and Future of Economic Growth.
The Near-Term Future of Economic Growth: Economic SuperPower Succession
80 Minute Lecture Skeleton:
Warm-Up (10 minutes):
- 1 qualitative review question
- 1 BIG IDEA question
- 1 calculation question
- 2 minutes: what did we learn last time?
- 5 minute discussion
3 Core Modules:
- (17 minutes): Lecture/Document/Tools/Tools Application/Open-Ended Question Discussion
- (3 minutes): Structured Review Questions
- (3 minutes): Pick 2 or 3 from 5 questions: calculation, main point takeaway, why aren't answers 25-25-25-25?, why this is important, what didn't I say?
- 1 free-form lecture response question (response emailed)
In-class exercises: 1/3 of a point for answering more than 2/3 of iClicker questions; 1/3 of a point for getting at least 1/3 of iClicker questions right; 1/3 of a point for post-lecture response...
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