Course info

Course Objective: 

This course explores the relationship between political institutions and economic development, covering key theoretical issues as well as recent empirical evidences. Topics include corruption, democracy, dictatorship, and war. Discusses not just what we know on these topics, but how we know it, covering how to craft a good empirical study or field experiment and how to discriminate between reliable and unreliable evidence.

Course Outcomes:  The students will be able to

1

Build a foundation for thinking about the role of political economy in understanding economic development.

2

Understand some core theoretical concepts in political economy, with illustrations from developing countries whenever possible.

3

Understand empirical evidence in economics. What makes a good empirical study? How do we learn about the world empirically? What are some of the techniques we can use to better understand the world?

Course Content:  

 UNIT I

Introduction: Why study political economy and development? Motivation and course overview; Different traditions in political economy – classical political economy, marxist political economy, new political economy

 10 hrs

 UNIT II

Does Political Economy Matter for Economic Development? Some Facts and Empirical Techniques. The Role of Leaders and Democratic Institutions; The Deep Determinants of Economic Development: Macro Evidence; The Deep Determinants of Economic Development: Micro Evidence; inequality and economic growth; political economy and social/human development

 10 hrs

UNIT III

Voting I: The Median Voter Theorem; Voting in Practice: Citizen-Candidate Models, Politician Identity and the Failure of the Median Voter Theorem; Voting in Practice: Agency Models; Voting in Practice: Vote buying and voter intimidation;

10 hrs

 UNIT IV

Voting II : Sometimes It Gets Complicated: Condorcet's Paradox and Arrow's Impossibility Theorem. Good vs. Bad Dictatorships; Commitment problems in Dictatorship

 10 hrs

UNIT V

Collective Actions: The Logic of Collective Action; Ethnic Heterogeneity and Contributions to Public Goods; Monitoring and Collective Action Problems; Recovery from Civil War; Why Do Wars Happen; Civil War.

 10 hrs

UNIT VI

Corruption: Is Corruption Inefficient; The Corrupt Official's Decision Problem: Balancing Risks, Rents, and Incentives; The Industrial Organization of Corruption; Politicians and Firms

10 hrs

Internal Assessment: 

 CIA 1

Unit I, Unit II 

 CIA 2

Assignment submission and/or presentation 

Text Books: 

1.       Bardhan, P. (1998), Political Economy of Development in India, Oxford: Oxford University Press.

2.       Charles Sackrey, Geoffrey Schneider  and Janet Knoedler (2013), Introduction to Political Economy, 7^th/8^th edition, Dollars and Sense. 

 Reference Books: 

3.       Bardhan (1999), Political Economy of Reforms in India, New Delhi: NCAER.

4.       Fine, Ben and Milonakis, Dimitris (2008), From Political Economy to Economics: Method, the Social and the Historical in the Evolution of Economic Theory. Routledge.

5.       Frankel, F. (2005), India’s Political Economy: a gradual revolution, 1947-2004, Oxford University Press.

6.       Jevon, W. Stanley. The Theory of Political Economy

7.       Ricardo, David. (1817). Principles of Political economy and Taxation, the Sraffa edition.

8.       Roland, G. (2000) Politics, Market and Firms, The MIT Press: Cambridge, Mass.

9.       Roncaglia, Alessandro. (2005). The Wealth of Ideas. Cambridge University Press, Cambridge

10.    Simon, David (2005). Fifty Key Thinkers on Development, Routledge.

11.    Smith, Adam. (1776). An inquiry into the nature and causes of the wealth of nations, The Glasgowedition.

12.    Sweezy, Paul (1970). The Theory of Capitalist development: Principles of Marxian Political economy. Modern Reader Paperbacks, New York