UNIVERSITAT POMPEU FABRA
Economic Growth and Development (Part 2); Spring 2011
Prof. Luigi Pascali
The course focuses on models of growth and their empirical implications. Most of the
course will be based on papers. An outline of the theoretical models can be found in
one the following textbooks:
-Barro R. J. and X. Sala-i-Martin, “Economic Growth”
-Romer D., “Advanced Macroeconomics”
-Acemoglu D., “Introduction to Modern Economic Growth”
GRADING: The final grade will depend on your performance in a final exam (50%),
two problem sets (20%) and your active attendance (30%).
PROBLEM SETS: There will be two problem sets, which will be handed out in the first
lecture of the second and the fourth week. You have to hand in the solutions in the
following week.
OFFICE HOURS: By appointment.
STRUCTURE OF THE COURSE: The course will last 5 weeks and is divided into 5
parts: 1) Endogenous Growth Models; 2) Competition and growth; 3) Finance and
Growth; 4) Stages of Growth; 5) Welfare and Growth.
LIST OF TOPICS
1) Endogenous Growth Models: theory and empirical evidence (2 Lectures)
a) Expanding variety model
i) Science and profits
ii) Broda and Weinstain (2006)
iii) Aghion, Antras and Prantl (2011)
iv) Comin and Mulani (2007)
b) Shumpeterian model
c) Scale effects
i) Kremer (1993)
ii) Backus, Kehoe & Kehoe (1992)
iii) Howitt (1999)
2) Competition and Growth: theory and empirical evidence (2 Lectures)
a) Competition as an incentive scheme
b) The inverted U-relationship between competition and innovation
c) A model with entry
d) Empirical evidence
i) Blundell, Griffith and Van Reenen (1999)
ii)
iii)
iv)
v)
Nickell, Nicolitsas and Dryden (1997)
Aghion, Bloom, Blundell, Griffith and Howitt (2003)
Aghion, Blundell, Griffith, Howitt and Prantl (2003)
Nicoletti, Scarpetta (2003)
3) Finance and Growth: theory and empirical evidence (2 Lectures)
a) A model with Ex-Ante Screening
b) A model with Ex-Post Monitoring and Moral Hazard
c) Empirical evidence
i) King and Levine (1993)
ii) Rajan and Zingales (1998)
iii) Jayaratne and Strahan (1996)
iv) Levine, Loayza and Beck (2000)
v) Pascali (2011)
4) Stages of growth (2 Lectures)
a) The Malthusian Epoch
i) Ashraf and Galor (2011)
b) The Post-Malthusian Regime
c) Unified Growth Theory
5) Welfare and Growth(2 Lectures)
a) Welfare comparisons
i) Weitzman (1976)
ii) Weitzman (2001)
iii) Basu, Schiantarelli, Serven, Pascali (2011)
iv) Jones and Klenow (2011)