1 Causality wrap-up 2 East Asia definitions 3 Chapter 2 4 Causality: how do economists handle? 1 Qualitative or highly qualitative argument: Ricardo, Adam Smith, Friedman Hershman highly qualitative Ruling out other potential causes, typically case studie
A. Competing Explanations 1. Neoclassical explanations: market and price mechanism Y=At(H+K) k, h, a At: efficient allocation of resources, effective use of techniques Savings rate, n, d How did large quantities of k, h, l come about in first place? 2. St
Assignment13 Greenhalsh Guiso Pekkanen? Wan? Examtalk?
A. Cypher/Dietz Ch. 12 Question 4 Question 7 (follow the data hints in the question or go to http:/hdrstats.undp.org/en/indicators/indicators_table.cfm, scroll down to section 7) For simplicity, you c
University of Southern California
Department of Economics
Economics 343 Economics of East Asia
Monday/Wednesday 2-3:50pm, KAP144
Instructor: Carsten A. HOLZ
Office hours: Wednesday 10:30-11:30 and by appointment, KAP 300E
Contact e-mail: carsten
B. Taiwan developed rapidly in the 1960s and 1970s due to sound macroeconomic policy.
Briefly explain the problems involved in supporting this causal statement, and how it could
possibly be supported.
Chapter 9 Question 1,2 : will hand in in class
A state enterprises operations promote the production of positive externalities accruing
to private producers in the economy in the form of increased private returns, it is entirely
1. Contrast Flaths rationales for industrial policy with those of Rodrik.
Answer: Flaths rationale for industrial policy is to divert the distribution of resources
in a coherent and intended fashion while Rodrik thinks industrial policy is used t
1. Does China have an equivalent to the Japanese keiretsu or to the Korean chaebol?
Explain. From the point of view of industrial structure / firm organization, which East
Asian country do you think China resembles most?
2. Why do you think
A1: I think the most plausible argument why China did not industrialize earlier is the
feeling of superiority. The emperor named himself son of the heaven and Chinese think
China is the center of the world. The feeling of superiority decreases the motives
A. Cypher/Dietz Chapter 4
Questions 1, 3, 6, 7, 9
B. Cypher/Dietz Chapter 5
Questions 1, 2, 6, 7
C. Capitalism and economics
In class, we had a definition of capitalism as
a political, social, and economic system in which property, including
1. Thinking of Hayeks arguments on the use of knowledge in society, do you see a
difference in their applicability to developing vs. developed economies?
Answer: developed economies use more scientific knowledge, and they try to collect more data
Henry Wan reading
Ch. 7 Korea, p. 218, Question 5
5. I think opinion B is right. The real GDP growth of Korea did bounce back in 1999
and 200, but the cost of government bailout was way too high. Debt to the foreigners
and the public after 1997 at least d
(a): The first condition is that people are greedy and self-interest is the guiding principle. The
second condition is that there is competition in the market amongst participants. The reason why
both are required for the harmony of interests is that
A. Albert Hirschman. The Strategy of Economic Development.
1. How does complementarity matter in economic development? How does it
relate to induced investment?
Complementarity is any situation where an increase in the demand for commodity
A and the conse
A. Henry Wan reading Chapter 9, Hong Kong, p. 271, Questions 1 and 3
1. In the theory of international trade, factor price equalization is a
trend among economies sharing the same technology. Both Hong
Kong and part of the PRC across the border have produ
1. Does China have an equivalent to the Japanese keiretsu or to the Korean chaebol? Explain. From the point of view of industrial structure / firm organization, which East Asian country do you think China resembles most? 2. Why do you think the Chinese ec
HW discussion GDP/Capita Sen Amartya Ch. 3 Sound macroeconomic policy: sound monetary policy (non-inflationary), balanced government fiscal budget, balanced current account: no trade deficit, no import/export excess. Policies that favor economic growth. T
Ch. 3 and Ch. 4 Development in Historical Perspective Colonialism: key concern was that colonizers only cared about people at home. This had some lasting effects 1.Lasting effects a.Path dependence: historically formed institutions dont change rapidly b.P
Dualist structures: Social systems/institutions vs. imported Handicrafts vs. modern industry: higher wages, higher labor productivity Local trade vs. export orientation Colonial rule leads to biased investment, export-oriented Potentially destroys emergin
Why did China not industrialize earlier A. Mark Elvin 1.Potential reasons: lack of capital: for investment->low labor productivity, low income, low mass purchasing power, no pressure to invest Restricted markets Political obstacles-government levies custo
1.Nurkse and Lewis commonalities: Bad on export of agricultural goods, want reinvestment in domestic market 2.Ideas that developmental economists tended to share: there is one answer: a development strategy, following a recipe. About less developed countr
Perkins Ch.9, Ch 10 Miracle? Talk about midterm Perkins A.Intro No single HPAE model of development, but 3 i.Manufacture export-led state interventionist, J, K, T ii.Free port-service, commerce oriented model of S, HK iii.Rich in natural but not human res
Assignment 5 Hayek Rodrik Assignment 5 1.GDP growth rate and industrial growth rate is very similar. Should be an upward sloping relationship. 2.Physical capital makes all the difference. Industrial shares in GDP: higher for agriculture, lower for industr
Rodrik Jenkins Thuu? Ten Design Principles i.new ii.criteria iii.sunset clause iv.public support must target activities not sectors. Picking sectors is difficult because government cannot pick winners according to some v.activities must have potential of
Assignment 6 Hirschman Textbook Ch. 7 No need to remember specific dates or numbers: rough times for numbers is enough Assignment 1. Personal knowledge versus scientific knowledge: relevant to developed or undeveloped country? if youre a developed country
A. Albert Hirschman. The Strategy of Economic Development. 1. How does complementarity matter in economic development? How does it relate to induced investment? 2. Explain the concept of an efficient sequence. 3. Under what circumstances do you think Albe