Development Economics: Inframarginal Versus Marginal Analysis

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Chapter 1: Introduction
1.1. Classical Development Economics and Capitalist Economic Development
1.2. Breakdown of the First Global Capitalist System and Neoclassical Development Economics
1.3. A Return to Classical Development Economics
1.4. The Scientific Approach to Development Economics
Key Terms and Review
Further Reading
Questions
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Part I: Geography and Microeconomic Mechanisms for Economic Development
Chapter 2: Geography and Economic Development
2.1. Uneven Economic Development in Different Parts of the World
2.2. Geography and Division of Labor
2.3. Empirical Linkages of Geography and Economic Development
2.3.1. Geographical Correlates of Economic Development
2.3.2. Geography and Levels of per capita Income
2.3.3. Geography and Growth of per capita Income
2.3.4. Geographical Effects on Economic Policy Choices
Key Terms and Review
Further Readings
Questions
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Chapter 3: Driving Force I - Exogenous Comparative Advantage and Trading Efficiency
3.1 Use the Concept of General Equilibrium to Figure Out Mechanisms for Economic Development
3.2 A Ricardian Model with Exogenous Comparative Technological Advantage and Transaction Costs
3.3 Analysis of Decisions vs. Equilibrium Analysis of Development
3.4. Per capita Real Income, GDP, GNP, and PPP
3.5. Economic Development and Trade Policy
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3.6 Comparative Endowment Advantage and Transaction Efficiency
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 4: Driving Force II - Endogenous Comparative Advantage and Trading Efficiency
4.1 Endogenous vs. Exogenous Comparative Advantages
4.2 Configurations and Corner Solutions in a Smithian Model
4.3 How the Market Coordinates Division of Labor to Utilize Network Effects and Promote Economic Development
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4.4 More Examples
4.5 Pattern of Trade
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 5: Driving Force III - Economies of Scale
and Trading Efficiency
5.1. Economies of Scale and Economic Development
Questions to Ask Yourself When Reading This Chapter
5.2. General Equilibrium Models of Economic Development with Trade offs Between Economies of Scale, Consumption Variety, and Transaction Costs
5.3. The Ethier Model with Transaction Costs
5.4. The Murphy-Shleifer-Vishny (MSV) Model of Big Push Industrialization
5.5. The Sachs and Yang Model with Economies of Scale, Endogenous Degree of Industrialization, and Transaction Costs
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 6: Coexistence of Endogenous and Exogenous Comparative Advantages and Patterns of Development and Trade
6.1. Underdevelopment and Dual Structure with Underemployment
6.2 A Smithian Model with Dual Structure in the Transitional Stage of Economic Development
6.3. General Equilibrium and Its Inframarginal Comparative Statics
6.4. Trade Pattern in the Presence of Both Endogenous and Exogenous Comparative Advantages and the Relationship Between Income Distribution and Development
6.5. Development Strategies and Trade Patterns
6.5.1. A Consumer's Decision
6.5.2. Possible Trade Structures
6.5.3. Production of Agricultural Good z
6.5.4. Production of Final Manufactured Good y
6.5.5. Production of Intermediate Goods
6.5.6. Local Equilibrium in Structure A
6.5.7. Local Equilibrium in Structure C
6.5.8. Local Equilibrium in Structure D
6.5.9. Local Equilibrium in Structure E
6.5.10. Local Equilibrium in Structure F
6.6. General Equilibrium and Inframarginal Comparative Statics
6.7. Comparison with Conventional Wisdom Based on the Models with CRS
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 7: Structural Changes, Trade, and Economic Development
7.1. Endogenous Trade Theory and Endogenous Number of Consumer Goods
7.2. A Model of Economic Development with Fixed Learning Costs
7.3. How Are Demand and Supply Functions Determined by Individuals’ Levels of Specialization?
7.4. Inframarginal Comparative Statics of the Optimum Decisions
7.5. How is the Level of Division of Labor in Society Determined in the Market?
7.6. Inframarginal Comparative Statics of General Equilibrium and Many Concurrent Development Phenomena
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7.7. Emergence of International Trade from Domestic Trade
7.8. Comovement of Division of Labor and Consumption Variety
7.9. Emergence of Professional Middlemen and Trade Pattern
7.10. Trade off Between Economies of Specialization and Coordination Costs
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 10: Transaction Risk, Property Rights,
Insurance, and Economic Development
10.1. Uncertainties in Transactions and the Economics of Property Rights
10.2. Economic Development and the Trade off between Economies of Division of Labor and Coordination Reliability
10.3. Endogenization of Coordination Reliability in Each Transaction and Substitution between Competition and Better Enforced Property Rights
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10.4. Why Can Insurance Promote Economic Development?
10.5. Economic Development and Endogenous Transaction Costs caused by Moral Hazard
Key Terms and Review
Further Reading
Questions
Exercises
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Part III: Urbanization and Industrialization
Chapter 11: Urbanization, Dual Structure between Urban and Rural Areas, and Economic Development
11.1. Why and How Cities Emerge from the Division of Labor
11.2. The Fujita-Krugman Model of Urbanization based on the Trade off Between Economies of Scale and Transaction Costs
Differentiation of (11.6) and (11.7) yields
11.3. Emergence of the Dual Structure between Urban and Rural Areas from the Division of Labor
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11.4. Why Can the Geographical Concentration of Transactions Improve Transaction Efficiency?
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11.5. Simultaneous Endogenization of Level of Division of Labor, Location Pattern of Residences, Geographical Pattern of Transactions, and Land Prices
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 12: Industrialization, Structural Changes, Economic Development, and Division of Labor in Roundabout Production
12.1. The Features of Industrialization
12.2. Industrialization and Evolution of Division of Labor in Roundabout Production
12.3. Corner Equilibria and the Emergence of New Industry
12.4. General Equilibrium, Industrialization, and Structural Changes
12.4.1. Changes in the Employment Shares of the Industrial and Agricultural Sectors
12.4.2. The Number of Possible Structures of Transactions Increases More Than Proportionally as Division of Labor Evolves in Roundabout Production
12.5. Evolution in the Number of Producer Goods and Economic Development
Figure 12.3: Industrialization and Evolution of Division of Labor
Key Terms and Review
Further Reading
Questions
Exercises
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Part V: Dynamic Mechanisms for
Economic Development
Chapter 13: Neoclassical Models of Economic Growth
13.1. Exogenous vs. Endogenous Growth
13.2. The Ramsey Model and the AK Model
13.3. R&D Based Endogenous Growth Models
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 14: Economic Development Generated by Endogenous Evolution in Division of Labor
14.1. Economies of Specialized Learning by Doing and Endogenous Evolution in Division of Labor
14.2. A Smith-Young Dynamic Model with Learning by Doing
14.3. Optimum Speed of Learning by Doing and Evolution of Endogenous Comparative Advantage
14.3.1 The Function of Contracts
14.3.2 An Individual's Dynamic Decision Problem
14.3.3 Dynamic Equilibrium
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14.4. Endogenous Evolution of the Extent of the Market, Trade Dependence,
Endogenous Comparative Advantages, and Economic Structure
14.5. Empirical Evidences and Rethinking Endogenous Growth Theory
Appendix 14.1: The Relationship between the Control Theory and Calculus of Variations
Key Terms and Review
Further Reading
Questions
Exercises
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Part V: Macroeconomics of Development
Chapter 16: Investment, Saving, and Economic Development
16.1. Smith and Young's Theory of Investment and Saving
16.2. Neoclassical General Equilibrium Models of Self-Saving and Interpersonal Loans
16.3. Smith and Young's Theory of Investment and Savings
16.3.1. The Model
16.3.2. Configuration Sequence and Structure Sequence
16.3.3. Dynamic Corner Equilibria in 16 Structure Sequences
16.4. Investment, Capital, and Division of Labor in Roundabout Production
16.4.1. Dynamic General Equilibrium
16.4.2. Non-topological Properties of Economic Growth and Sudden Decline of Interest Rates
16.4.3. Endogenous Decision Horizon and Effect of Liberalization Reforms on Opportunities for Lucrative Investment
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 17: Money, Division of Labor, and Economic Development
17.1. Neoclassical vs. Classical Theories of Money
17.2. A Smithian Model of Endogenous Monetary Regime and Economic Development
17.3. Possible Structures and Monetary Regimes
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 18: Endogenous Business Cycles, Cyclical Unemployment, and Endogenous, Long-run Growth
18.1. Rethinking Macroeconomic Phenomena in Economic Development
18.2. Long-run Regular Efficient Business Cycles, Cyclical Unemployment, Long-run Economic Growth, and Division of Labor in Producing Durable Goods
18.3. A Smithian Dynamic Equilibrium Model of Business Cycles, Unemployment, and Economic Development
18.4. Cyclical vs. non-cyclical Corner Equilibria
18.4.1 Regime Specification, Configurations and Market Structures
18.4.2 The Dynamic corner equilibrium in Autarky
18.4.3 Market Structure C
18.4.4 Market Structure P
18.4.5. Welfare and Policy Implications of the Model
18.5. General Price Level, Business Cycles, and Unemployment Rate
18.6. Emergence of Firms and Fiat Money from the Division of Labor
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 19: Economic Transition
19.1. Understanding Economic Transition
19.2. The Socialist System and Evolution in Division of Labor
19.3. Driving Mechanisms for Transition
19.4. Market-oriented Reforms Associated with the Transition of Constitutional Rules
19.5. Market-oriented Reforms in the Absence of Constitutional Order
19.6. Trade offs between Reliability and the Positive Network Effects of Division of Labor and between Incentive Provision and Stability
Key Terms and Review
Further Reading
Questions
Exercises
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Part II: The Institution of the Firm, Endogenous Transaction Costs, and Economic Development
Chapter 8: Economic Development, the Institution of the Firm, and Entrepreneurship
8.1. What is the Institution of the Firm?
8.2. Why are Claims to Residual Rights of the Firm Essential for Nurturing Entrepreneurship? -The Story behind the Model
8.3 The Emergence of the Firm from the Evolution of Division of Labor
8.3.1. Economies of Roundabout Production
8.3.2. The Corner Equilibria in Four Structures
8.3.3. General Equilibrium Structure of Transactions and Residual Rights
8.4. The Distinction Between ex ante and ex post Production Functions and the Role of the Institution of the Firm in Economic Development
8.5. Coase Theorem and Other Theories of the Firm
Key Terms and Review
Further Reading
Questions
Exercises
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Chapter 9: Endogenous Transaction Costs, Contract, and Economic Development
9.1 Endogenous Transaction Costs and Economic Development
9.2. Endogenous Transaction Costs Caused by Moral Hazard
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9.3. Game Models and Endogenous Transaction Costs
9.3.1. Game Models
9.3.2. Nash Equilibrium
t1 = 0
t1=t1*
t1 = 0
t1=t1*
9.3.3. Subgame Perfect Equilibrium
9.3.4. Bayes Equilibrium
9.3.5. Sequential Equilibrium
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9.4. The Role of Nash Bargaining Game in Reducing Endogenous Transaction Costs caused by Trade Conflict
9.5. Endogenous Transaction Costs caused by Information Asymmetry and Holding Up
9.5.1. Economic Development and Endogenous Transaction Cost caused by Adverse Selection
9.5.2. Alternating Bargaining Game in a Model of Endogenous Specialization
9.5.3. Economic Development and Endogenous Transaction Costs Caused by Holdin Up
9.5.4. How Can Endogenous Transaction Costs be Eliminated by Consideration of Reputation?
9.6. The Grossman-Hart-Moore Model of Incomplete Contract
9.7. Non-Credible Commitment and Soft Budget Constraint
Key Terms and Review
Further Reading
Questions
Exercises
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Index
Dreference
Rosenberg, N. and Birdzell, L. E. (1986), How the West Grew Rich: Economic Transformation of the Industrial World, New York, Basic Books.
reference-dev-final
Rosenberg, N. and Birdzell, L. E. (1986), How the West Grew Rich: Economic Transformation of the Industrial World, New York, Basic Books.