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Development economics > Exam > Flashcards

Exam Flashcards

1
Q

Give some reasons why GDP may fail to measure value added in a country.

A

Tjek

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2
Q

Briefly explain the difference between exchange rate conversion and PPP
conversion of GDP.

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3
Q

Using the information in PRLB Table 2-1, use Indian prices to calculate GDP for US
and India in PPP Rupees. Comment on the result relative to using US prices and
USD.

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4
Q

Based on the growth rates presented in Table 2-3. How many years would it take
for the average country in each region to double its GDP per capita if it grew as
recorded in the 2000s?

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5
Q

Explain the so-called Easterlin paradox.

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6
Q

Explain briefly whether the Washington Consensus was consistently grounded in
economic theory or should more be considered as a policy paradigm.

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7
Q

Outline the six common elements of sustained growth experiences, and highlight
which channel was under-emphasized in the Washington Consensus strategy

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8
Q

Please give some reasons why food only constitutes about ½ to ¾ of the total
consumption expenditure for the extremely poor people in the world.

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9
Q

Please give some reasons why the extremely poor people in the world are often
involved in many occupations.

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Tjek

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10
Q

Please explain the referencing problem in theoretical poverty analyses and explain
how the referencing is “solved” in practice using the cost-of-basic-needs method.

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Tjek

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11
Q

Please explain the identification problem in theoretical poverty analyses and
explain how the problem is “solved” in practice in most poverty measurements
developing countries.

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12
Q

Explain the concepts strongly relative versus weakly relative poverty lines and
describe the problems with each respective measure. Outline a possible solution to
the problems.

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Tjek

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13
Q

Please explain briefly, why intra-household inequality may be a source of bias in
survey-based estimates of inequality and state if the bias is positive or negative.

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14
Q

Please explain how it is possible to argue that:
- Global inequality has increased from around 1980 to around 2000
- Global inequality has decreased from around 1980 to around 2000
- Global inequality has been roughly constant from around 1980 to around 2000

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15
Q

Please explain how income inequality may affect the accumulation of physical
capital.

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16
Q

Please explain how income inequality may affect the accumulation of human capital.

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17
Q

Please describe the difference between absolute and relative inequality

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18
Q

Please explain how to easily test the poverty-inequality relationship. Comment on
the empirical relationship between:
a. Absolute Poverty and Absolute Inequality
b. Absolute Poverty and Relative Inequality

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19
Q

Please explain what is meant by the notion “conditional convergence” and clarify how
it differs from “unconditional convergence”.

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Tjek

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20
Q

Please define and explain the development and growth accounting, respectively.

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21
Q

Please describe the 4 stages of the demographic transition.

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22
Q

Please outline and describe the 3 scenarios for how total fertility rates can stay
above replacement rates.

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23
Q

Please describe likely causes of the mortality and fertility transitions, respectively
and discuss the sequencing of the transitions.

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24
Q

Outline the basic ideas of population pessimists versus population optimists.

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25
Q

Outline the likely estimation biases faced when analyzing the relationship between
population growth and income.

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Tjek

26
Q

Describe using a Solow model framework how migration is likely to influence
capital accumulation (including the underlying assumptions). Consider both the
case where migration is “just” influencing population growth (n) as compared to
the situation where migrants is assumed to bring productive capital.

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Tjek

27
Q

Outline the 4 important questions to ask when evaluating traditional migration
models against empirical evidence?

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Tjek

28
Q

Please explain the difference between the gross and the net enrollment rate and explain how the
average primary gross enrollment rate can be larger than 100%.

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29
Q

Please explain (graphically) the Mincerian investment decision in education

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Tjek

30
Q

Please give three examples of problems of school funding in developing countries

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31
Q

Please illustrate and describe the 3 main lessons learned from the Preston Curves.

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32
Q

Please explain the theoretical relationship between health and education using the envelope theorem

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33
Q

Please describe at least two reasons for why savings rates differ across countries,
and briefly explain each of the reasons/implications for development policy?

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Tjek

34
Q

Based on the 3 figures below explain the allocation puzzle and whether it is an
investment or a savings puzzle.

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35
Q

Please outline and describe the main pros and cons of attracting FDI.

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36
Q

Please describe the key FDI knowledge transfer/spillover mechanisms.

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37
Q

Describe the positive and negative mechanisms of vertical FDI spillovers (backward
and forward spillovers).

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38
Q

Please outline 3 sources of productivity (TFP) growth at the firm level.

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Tjek

39
Q

Please describe what is meant by resource misallocation and illustrate how relative
marginal products of capital can be used to identify whether firms of different
employment size are financially constrained.

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40
Q

Please explain what increased variance in TFPQ and TFPR, respectively will do to
sector level TFP (assume elasticity of substitution is larger than 2).

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41
Q

From the Table, please calculate the relative firm size difference between the 75
percentile and the 25 percentile for the 4 African countries. Moreover, comment on
the magnitude of the correlated distortions.

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Tjek

42
Q

Please outline the assumptions leading to marginal products of capital (MPK) being
proportional to average product of capital (APK).

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43
Q

Please describe what is meant by the “missing middle” and outline two different
ways of testing the hypothesis.

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44
Q

Please give three different motives for providing foreign aid

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45
Q

Please explain how donations of food to a country can hurt local farmers by
undermining the incentives for them to produce food. [PRLB box 14-5]

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46
Q

Please explain and present graphically the three views on aid and growth given in
PRLB chapter 14.

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47
Q

Please sketch or draw two simple versions of the Solow growth model in which a
temporary inflow of foreign aid may have permanent effects on the level of income
per capita. [Hint: Think of low-income traps generated by low savings rates and
high population growth rates].

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Tjek

48
Q

Please explain how Galiani et al. (2017) identifies exogenous changes in foreign aid to 38 recipient countries

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49
Q

Please outline and describe (graphically) the Lewis model.

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50
Q

Please explain and describe graphically how to reach the result of an inverse
relationship between land size and farming intensity.

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51
Q

Please describe the “separation hypothesis” and outline an empirical test to verify
or falsify the hypothesis.

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52
Q

Please outline the pros and cons (from an efficiency point of view) of smallholder
farming

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53
Q

Please provide a 2 country-2 product example that explains absolute versus
comparative advantages.

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54
Q

Please explain the predictions of traditional trade theory in relation to within
country inequality in developing countries and what the empirical evidence
suggests.

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55
Q

Please explain the underlying idea behind the theory of economics complexity

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56
Q

Please explain how warfare can both lead to an increase and a decrease in post-
conflict welfare.

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57
Q

Please outline the main warfare predictions of the contest model in relation to
poverty and wealth effects.

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58
Q

Please explain the difference between climate mitigation and climate adaptation.

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59
Q

Using Figure 1 on the next page, please explain how Burke et al. (2015) connect
micro evidence on abrupt changes in productivity from increased temperature with
smooth changes at the macro level.

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Tjek

60
Q

Please explain how Burke et al. (2015) find and compute the global non-linear
relationship between annual average temperature and change in log gross
domestic product (GDP) per capita (thick black line) in Figure 2 below.

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Tjek

Development economics (1 decks)

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