Political Economy of the Middle East and North Africa IA 3300 Summer
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Political Economy of the Middle East and North Africa IA 3300 Summer 2012 Professor Akacem [email protected] June 4th-July 6th Office: Econ 216-A Office hours: Monday 12:45 p.m. to 2:45 p.m. http://Culearn.colorado.edu Please Note: Leave your laptops at home. I generally do not encourage their use in class. If you have a documented need for them, please do see me. Otherwise, the evidence shows that these are used for things that have nothing to do with class and they distract others. The same goes for cell phones and texting. There is a zero tolerance for their use. Email: Generally speaking, it is much easier to come to my office and or right after or before class if times allows. Avoid messages such as “I missed class, what did I miss”. If you do miss class, make sure and get the notes from another student. When sending an email message, please do include a subject such as our class, question etc… Messages without anything on the subject line may not be answered or caught in the spam filter. Finally, identify yourself in the first line of your message: example: this is John Smith from your Pol Economy of the Middle East class. With two classes, it helps to immediately know who the student is and which class the question is about in order to facilitate a complete and a quicker response. Objective of the Course: The course will help you understand and discuss the relevant economic and political development issues that are important to the Middle East and North Africa region. The Arab spring caught everyone by surprise and it amounted to a Tsunami raging through the region toppling governments and leaders who had run their countries for decades. We will discuss a number of issues such as what are the economic development constraints faced by this region? Despite the vast oil and gas wealth that the region generates, it still lags behind regions and countries that are not endowed with natural resources. To what extent does it suffer from the resource curse and what policies can be formulated to address it? Should oil revenues be distributed directly to the citizens? If so what are the implication to oil pricing and production strategies? Is it even feasible? Would this mean the end of OPEC? What implication would this have to the political system? The Middle East and North Africa has a youth bulge that requires the economies of the region to generate a large number of jobs far beyond its capability. What policies and/or reforms should MENA undertake to address this problem? Complicating matters, the education system fails to produce graduates that are well suited for demands of the 1 labor market. Should the whole education system be reformed? Is this related to an incentive problem? The Gulf countries rely on a substantial amount of expatriate labor. Is this sustainable in the long run? Main Texts: 1. Political Economy of the Middle East, Third Edition, by Alan Richards and John Waterbury, Westview Press, 2008, third edition. Referred to below as RW. 2. Islam and Mammon by Timur Kuran, Princeton University Press, 2004. Referred to below as TK 3. Free on line: Regional Economic Outlook: Middle East and Central Asia, the From the International Monetary Fund: Regional Economic Outlook as of April 2012, post Arab spring: http://www.imf.org/external/pubs/ft/reo/2012/mcd/eng/pdf/mena-update0412.pdf Main regional economic outlook: http://www.imf.org/external/pubs/ft/reo/2011/mcd/eng/pdf/mreo1011.pdf Optional: May be on reserve if available. The Elusive Quest for Growth, William Easterly, MIT press, 2002, Chapter 4, Educated for What?, chapter 11: Government can kill growth, chapter 12 Corruption and growth. Referred to below as WE. On Blackboard: 3. Waking from its sleep and the Gulf, special reports on the Arab World, The Economist 2009 on Blackboard, under Economist special on the Gulf/Arab world folder. 4. On Reserve if available: Arab economies in the twenty-first century, by Paul Rivlin, Cambridge University Press 2009. Chapters 2, 4 and 13. Referred to below as: PR The Prize: The Epic Quest for Oil, Money and Power, Daniel Yergin, A Touchstone Book, 2008. Chapters 31-36 and epilogue, pp 615 to 773. Referred to below as DY Video Series: 1. The Prize: This a prize winning documentary about the history of oil from its beginning to the creation of OPEC, through the two oil shocks and the geopolitics of oil, to the invasion of 2 Kuwait by Iraq in 1990. These will not be viewed in class to save on class time but you must view them on your own via the course reserves and do not wait until when we get to the oil markets unit to do so. The password is: pemena2012 2. The House of Saud: This is also posted on course reserves and can be viewed via streaming video. This should be viewed immediately. 3. Readings and data sources for the class in general: Arab World Competitiveness Report 2010 from The World Economic Forum, Geneva. http://www3.weforum.org/docs/WEF_GCR_ArabWorldReview_2010_EN.pdf For data on the region from the UNDP and the Human Development Reports and Development indicators for the region: http://hdr.undp.org/en/statistics/ Sources on oil: An excellent source for international oil data from BP and other sources: http://www.bp.com/productlanding.do?categoryId=6929&contentId=7044622 The Joint Oil Data Initiative: http://www.jodidata.org/ Energy Information Agency: http://www.eia.doe.gov/ EIA's country's analysis briefs: http://www.eia.doe.gov/emeu/cabs/contents.html The International Energy Agency (OECD, Paris) (do not confuse with the EIA, part of the US Department of Energy) http://www.iea.org/ The Oil and Gas Journal: http://www.ogj.com/index.cfm The Oil and Gas Journal International: http://www.oilandgasinternational.com/ US Geological survey: Energy resources program: http://certmapper.cr.usgs.gov/rooms/we/index.jsp The Gulf 2000 Site: Covers the following countries: Bahrain, Iran, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates: http://gulf2000.columbia.edu/ The IMF: http://www.imf.org/ Page where the list of recent Article IV reports are found: http://www.imf.org/external/np/sec/aiv/index.htm Country information page: http://www.imf.org/external/country/index.htm Finance and Development: 3 http://www.imf.org/external/pubs/ft/fandd/fda.htm International Monetary Fund: Regional Economic Outlook: http://www.imf.org/external/pubs/ft/reo/2010/mcd/eng/mreo1024.htm Special issue of Finance and Development on the Middle East and North Africa http://www.imf.org/external/pubs/ft/fandd/2003/03/index.htm The World Bank: http://www.worldbank.org/ Middle East and North Africa page: http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/MENAEXT/0,,menuPK: 247603~pagePK:158889~piPK:146815~theSitePK:256299,00.html Iran: A special from the N.Y. Times http://www.nytimes.com/library/world/mideast/041600iran-cia-index.html. Other Sources: It helps if you have access to or use the library to consult these publications: The Wall Street Journal The New York Times The Economist 4. Course Outline: Below is the list of topics that we will cover. Material will be covered and added as events warrant. RW=Richards and Waterbury Week 1: 1. Introduction, Case Study: The Saudi Question, viewed in class. From the New York Times, Times Topic: Saudi Arabia http://topics.nytimes.com/top/news/international/countriesandterritories/saudiarabia/index .html?scp=1-spot&sq=saudi%20arabia&st=cse Regional Economic Outlook: Middle East and Central Asia, From the International Monetary Fund: http://www.imf.org/external/pubs/ft/reo/2011/mcd/eng/pdf/mreo0411.pdf 2. RW chapter 1 and 2: Unfulfilled Promise, George T. Abed, F&D March 2003 http://www.imf.org/external/pubs/ft/fandd/2003/03/abed.htm 3. RW chapter 3: Economic growth and structural change Recipes for Success: Dani Rodrik on How to Grow the Economic Pie http://www.imf.org/external/np/exr/BForums/2007/summary/112907.htm 4 Getting the Diagnosis Right by: Ricardo Hausmann, Dani Rodrik, and Andrés Velasco found at: http://www.imf.org/external/pubs/ft/fandd/2006/03/hausmann.htm Week 2. 4. RW chapter 4 Population and economic development: A major challenge for the region Challenges of Growth and Globalization in the Middle East and North Africa, IMF, 2003. by George T. Abed and Hamid R. Davoodi. Found at: http://www.imf.org/external/pubs/ft/med/2003/eng/abed.htm Demography and economics, chapter 2, Paul Rivlin 5. Exchange rate regimes, oil and economic development: Dutch Disease: Too much wealth managed unwisely http://www.imf.org/external/pubs/ft/fandd/2003/03/ebra.htm#author Choosing Exchange Regimes in the Middle East and North Africa by Abdelali Jbili and Vitali Kramarenko, (2003) International Monetary Fund http://www.imf.org/external/pubs/ft/med/2003/eng/jbili/jbili.htm Should MENA Countries Float or Peg? Abdelali Jbili and Vitali Kramarenko http://www.imf.org/external/pubs/ft/fandd/2003/03/jbil.htm 6. The Gulf Cooperation Council: GCC Countries: From Oil Dependence to Diversification by Ugo Fasano and Zubair Iqbal (2003)International Monetary Fund http://www.imf.org/external/pubs/ft/med/2003/eng/fasano/index.htm Persian Gulf Myths by Graham E. Fuller and Ian 0. Lesser in Foreign Affairs, Volume 76, number 3, May/June 1997. http://www.foreignaffairs.com/articles/53044/graham-e-fuller-and-ian-o-lesser/persian- gulf-myths You may need to access it through the library to get the whole article.