University of Indonesia
Faculty of Economics
Undergraduate Program
ECON 12002 ECONOMIC DEVELOPMENT
3 credits
Odd Semester, Academic Year 2012/2013
Lecturer: Rus’an Nasrudin/Fithra Faisal Hastiadi
Desc ription
The course provides a comprehensive overview of economic development. It addresses the major
set of problem in economic development facing developing countries, such as poverty, inequality,
unemployment, population growth, environmental degradation and rural stagnation. For each
development problem, the course is designed to cover: (1) essential principles and concepts of
economics relevant for understanding the problem are explained in non-formal approach to suit
those students with little or no formal economic background, (2) real-world development problems
and relevant policy issues.
Objective. The major objectives of the course are to: (1) understand the economic development of the
developing countries (2) analyze the economic problems of developing countries , (3) discuss strategies
and options for accelerating growth, attaining sustainable development, reducing poverty and income
inequality and for coping with other development problems.
Competencies
Expected Learning Outcome/Competency
Knowledge
General economic knowledge (GK):
GK 1. Discussing basic economic theories using mathematical and graphical tools
GK 2. Understanding the relevance of economic theories in daily life
GK 3. Understanding the development of economic thoughts and theories and its origins
GK 4. Comprehending basic economic theories and employing them to discuss real
economic phenomena
Specific economic knowledge (SK):
SK 1. Discussing both economic and non-economic factors in the development of
economy
SK 2. Discussing the developments and directions of economic policies in general
SK 3. Understanding public, industrial and other specific economic theories and utilizing
them to discuss economic phenomena in the related fields
Skill
Intensity
Level
M
H
H
H
H
H
H
General economic skill (GS):
GS 1. Accessing, processing, presenting, and interpreting economic variables and
indicators
GS 2. Processing economic data using statistical/econometrical/mathematical softwares
M
Specific economic skill (SS):
SS 1. Analyzing the development and the direction of specific economic policies in the
M
H
1
Expected Learning Outcome/Competency
Intensity
Level
related fields (public, industry, etc.)
SS 2. Utilizing mathematical tools to perform dynamic economic analysis
SS 3. Selecting and using appropriate research methodology as tools for performing
economic analysis
SS 4. Analyzing the development and the direction of general economic policies in
Indonesian, regional, and global economy
SS 5. Scientifically writing economic analysis in essays, articles, or academic papers
(writing scientific economic analysis in the forms of essays, journal articles or academic
papers)
Transferrable/generic skill (TS):
TS 1. Thinking critically, creatively, and innovatively and nurturing intellectual curiosity
to solve problems at individual and group levels
TS 2. Operating and utilizing information communication technology
TS 3. Speaking and writing properly in Indonesian and English for both scientific and nonscientific purposes
TS 4. Planning logical systematic writing
TS 5. Identifying, searching, and finding relevant sources of reference for writing
TS 6. Writing by using formal language and by applying scientific rules
Attitude
and
professional
ethics
Transferrable/generic attitude (TA):
TA 1. Sensitive and responsive to any environmental, community, nation, and states
problems
TA 2. Full of integrity and respectful to others
TA 3. Being independent in financial and thought
L
H
H
H
H
M
H
H
H
H
H
H
H
Schedule: Thursday 08:00-10:30AM (Room A2.10)
Textbook
Todaro, Michael P. and Stephen C. Smith (2008). Economic Development 9th Edition. AddisonWesley. (T) .
Ray, Debraj (1998). Development Economics. Princeton University Press. (R)
Readings
JB
Bhagwati, Jadgish (2004). In Defense of Globalization. New York: Oxford University Press.
JD
Diamond, Jared (1999). Guns, Germs, and Steel. New York: W.W. Norton.
WE-A Easterly, William (2006). The White Man’s Burden. New York: Penguin.
WE-B
Easterly, William (2001). The Elusive Quest for Growth. Cambridge: MIT Press.
EH
Helpman, Elhanan (2004). Mystery of Economic Growth. Cambridge: Harvard University
Press/Belknapp.
RI
Isaak, Robert A. (2005). The Globalization Gap. New Jersey: Prentice Hall.
DL
Landes, David (2000). The Wealh and Poverty of Nations. New York: W.W. Norton.
2
PL
Legrain, Philippe (2002). Open World: the Truth About Globalisation. London: Abacus.
JS
Sachs, Jeffrey (2005). The End of Poverty. New York: Penguin.
Assignments




Midterm 30%
Final Exam 30%
Essay 30%
Group Discussion 10%
Course Plan
Session
1
2
3
4
5
6
7
Topics
Introduction
 The meaning of economic development
 Measurement of economic development
 Theories of economic development
Case study/issues
Economic Growth and development
 Limited value of the historical growth experience:
differing initial conditions
 The traditional neoclassical growth theory
 The contemporary model of development and
underdevelopment: endogenous growth theory,
coordination failure, multiple equilibria
Case study/issues
Capital formation and technical progress
 The role of capital formation
 Endogeneous growth theories
Case study/issues
Poverty
 Measurement
 Economic characteristics of poverty groups
 Policy options
Case study/issues
Income distribution (inequality)
 Measurement
 Growth and inequality
 Policy options
Case study/issues
Population growth
 Demographic transition
 Population dynamic and income growth
 Some policy approaches
Case study/issues
Human Capital : Health and Education
 Roles of education and health
References
T1-2
R2
T3, T5
R3-4
WE-A
WE-B
EH
T3-T5
WE-B
EH
T6
R8
JS
DL
T6
R6-7
JS
DL
T7
R9
T9
3

8
9
10
11
12
13
14
Education and health as investment (human capital
approach)
 Education, inequality and poverty
Case study/issues
Employment, migration and urbanization
 Employment, underemployment, unemployment
 Urbanization, urban informal sector
 Rural urban migration
Case study/issues
Agriculture and development
 The process of structural transformation
 Role of rural area in development
 Rural stagnation
Case study/issues
Environment and development
 Sustainable development concept
 Basic issues
 Traditional economic models of the environment
 Policy options
Case study/issues
International trade
 Key issues in development
 Traditional theory of international trade
 Limits of theory: development countries experience
Case study/issues
Aid and Foreign Investment
 The role of international agencies in development
Case study/issues
Development political economy
 Government failure and other key issues
 Planning versus the market economy
 Theories of policy formulation and reform
Case study/issues
Review
R10
T10
T11
R16-17
PL
RI
T15
TBA*
4