Economic Growth
WiSe 2024/2025
Free University Berlin
Lectures: Tuesday 12:00 – 14:00 in HFB/D lecture hall
Tutorials: Wednesday 14:00 – 16:00 in Hs 105 Hörsaal
Instructor: Dr Nicolas Syrichas
Email: nicolas.syrichas@fu-berlin.de
Office hours: by email appointment.
Overview: The main aim of this course is to apply economic theory to understand and interpret empirical observations on economic growth. By the end of this course, the students should have a basic knowledge of the main facts characterizing economic growth over time and across countries, as well as the ability to use theoretical models to develop explanations for these facts. In addition, the student should gain an understanding of the limitations and failings of current growth theories relative to the empirical facts. The theoretical part of the course will initially focus on the neoclassical growth model. Then, growth models with additional features such as endogenous population growth, human capital, and endogenous technological progress will be introduced. The final part of the course discusses the fundamental determinants of income inequality.
Prerequisites: Principles of Macroeconomics and Microeconomics.
Textbook: David N. Weil: Economic Growth, 3rd edition. Pearson.
Topics and Readings (subject to minor changes):
Additional readings are suggested to those students that want to read more on a topic or -in the case of textbooks- check out an alternative exposition. They are not mandatory to prepare for the exam.
- 1. Growth Facts
Weil textbook Chapters 1 and 2.
Additional readings:
- Charles Jones and Dietrich Vollrath, Introduction to Economic Growth, Chapter 9.
- Daron Acemoglu, Introduction to Modern Economic Growth, Chapter 1 (advanced).
- 2. The Solow growth model
Weil textbook Chapter 3.
Charles Jones and Dietrich Vollrath, Introduction to Economic Growth, Mathematical Appendix (A1.2-A1.6).
Additional readings:
- Charles Jones and Dietrich Vollrath, Introduction to Economic Growth, Chapter 2.
- Daron Acemoglu, Introduction to Modern Economic Growth, Chapter 2 (advanced).
- 3. Population and growth
Weil textbook Chapter 4; CORE, The Economy, Unit 2.
Additional readings:
- Weil textbook Chapter 5.
- Our World in Data (https://ourworldindata.org/): entries on Population and Health.
- 4. Tools for empirical analysis
- 5. Human capital
Weil textbook Chapter 6.
N. Gregory Mankiw, David Romer, and David N. Weil (1992). A Contribution to the Empirics of Economic Growth, Quarterly Journal of Economics, 107(2), pp. 407-437.
Additional readings:
- Our World in Data (https://ourworldindata.org/): entries on Education.
- Alternative material: Daron Acemoglu, Introduction to Modern Economic Growth, Ch. 3.3 (advanced).
- 6. Development Accounting and Growth Accounting
Weil textbook Appendix A1 of Chapter 1 and Chapter 7.
References:
Caselli, Francesco (2005). Accounting for Cross-Country Income Differences, in: P. Aghion & S. Durlauf (ed.), Handbook of Economic Growth, ed. 1, vol. 1, ch. 9, pp. 679-741 Elsevier.
Burda, Michael C., and Battista Severgnini (2018) Total Factor Productivity Convergence in German States since Reunification: Evidence and Explanations, Journal of Comparative Economics 46, 192–211.
Resources: Penn World Tables 10
- 7. Technology
Weil textbook Chapter 8 (excluding 8.3). Appendix A8.
Additional readings:
- CORE, The Economy, Sections 2.1-2.6.
- Charles Jones and Dietrich Vollrath, Introduction to Economic Growth, Chapter 4.
- AK model: Charles Jones and Dietrich Vollrath, Introduction to Economic Growth, Chapter 9.
- 8. Endogenous Growth: the Romer Model
Charles Jones and Dietrich Vollrath, Introduction to Economic Growth, Chapter 5.
Additional readings:
- Romer, Paul M. (1990) Endogenous Technological Change, Journal of Political Economy, Vol. 98, No. 5, Part 2, pp. S71-S102.
- 9. Efficiency
Weil textbook Chapter 10.
Additional readings:
- Hsieh, Chang-Tai and Peter Klenow (2009). Misallocation and Manufacturing TFP in China and India, Quarterly Journal of Economics, 124(4), pp. 1403-1448.
- 10. Institutions
Weil textbook Chapters 12.
Additional readings:
Acemoglu, Daron, Simon Johnson and James A. Robinson (2001). The Colonial Origins of Comparative Development: An Empirical Investigation, American Economic Review, 91(5), 1369-1401.
- 11. Culture
Guiso, Luigi, Paola Sapienza, and Luigi Zingales (2006). Does Culture Affect Economic Outcomes?. Journal of Economic Perspectives, vol. 20, n. 2, pp. 23-48.
Additional readings:
Weil textbook Chapter 14.1-14.2.
Resources: World Value Survey Online Data Analysis.
- 12. Income inequality
Weil textbook Chapter 13.
Resources: World Inequality Database.
- 13. Bonus lecture: Automation (depending on time to revise Solow)
Prettner, Klaus (2019). A Note On The Implications Of Automation For Economic Growth And The Labor Share. Macroeconomic Dynamics, 23(3), 1294-1301.
Violante, Giovanni L. (2008) Skill-Biased Technical Change. In: Palgrave Macmillan (eds) The New Palgrave Dictionary of Economics. Palgrave Macmillan, London.
Assessment: Successful completion of a written exam of 90 minutes duration.
Exam structure (provisional)
- Multiple choice questions 21 points
- Open Question 18 points
- Short Exercise 21 points
- Long Exercise 30 points
Total points: 90