Global Economy: Emergence and Current Issues

Lecturer: Julius Horvath No. of Credits: 4 CEU credits (second part with Gerrardo della Paolera in Winter 2016/2017) Status: Mandatory course for MA students of Economic Policy Program, Elective Course for International Relations students Course Level: Master level class The learning outcomes: In this course students are able to understand some important concepts of the global economy. The main goal is to provide students with some historical underpinnings of the global economy as well as its current driving forces. Students are led to formulate their own research question. Course Description: This course presents systematic explanation of the emergence of the global economy. This course is prepared as a broad introduction to the topics at the centre of policy debates, which the student - who may one day be involved in policy making in different contexts - might find useful. The course is taught in non-technical manner. Assessment: 50% of the total grade; presence in class 5%, presentation 12%, quiz 8%, final paper 25%. Extra credit will be given for constructive classroom discussion. Pre-requisites: No special pre-requisites are required. This course is accessible to anyone with a solid under-graduate background in social sciences.

Please note we will use ceulearning.ceu.edu site in the course, and the syllabus on this webpage the student is to follow.

I. Emergence of Modern Growth Mokyr, Joel, „The Intellectual Origins of Modern Economic Growth,” The Journal of Economic History, Vol. 65, No. 2, June 2005, 285-351 David, Paul, “The Historical Origins of ’Open Science’: An Essay on Patronage, Reputation, and Common Agency Contracting in the Scientific Revolution, Capitalism and Society, Volume 3, Issue 2, 2008 Article 5, 1-33 Landes, David, “Why Europe and the West and Why not China?” Journal of Economic Perspectives Volume 20, Number 2, Spring 2006, 3–22 Landes, David S., “Why Are We so Rich and They so Poor? Richard T. Ely Lecture, American Economic Review, 1990, May, 1-13 Eichengreen, Barry, “Globalizing Capital. A History of the International Monetary System,” Princeton University Press, 1996, Chapter Two, The Gold Standard, 7-42 Weil, David. Economic Growth, Pearson Addison Wesley 2005, or newer editions

II. Some Characteristics of the XX Century Growth Bourguignon, François. "Inequality between Nations." The New Palgrave Dictionary of Economics, second edition, Eds. Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008 Howitt, Peter and David N. Weil. "Economic Growth" The New Palgrave Dictionary of Economics, edited by Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008 1

Page

Piketty, Thomas, Capital in the Twenty-First Century, the Belknap Press of Harvard University Press, 2014, 1-27, 199-250, 274-281, 571-577 Pritchett, Lant, “Divergence, Big Time,” Journal of Economic Perspectives, Summer 1997, 3-17 Mancur, Olson Jr., “Big Bills Left on the Sidewalk: Why Some Nations are Rich and Others Poor,” Journal of Economic Perspectives, Volume 10, Number 2, Spring 1996, pp. 3-24 Williamson, Jeffrey (2002) “Winners and Losers Over Two Centuries of Globalization”, NBER Page | 2 Working Paper No. 9161 Collier, Paul and Jan Willem Gunning, “Why has African Grown Slowly? Journal of Economic Perspectives, 1999, 3, pp 3-22 Allen, Robert C., History of Global Economy, The Very Short Introduction, Oxford University Press, Chapter 7 Africa, pp 97-113 Easterly, W. (2001), The Elusive Quest for Growth, Cambridge, MA. MIT Press Guillaume Daudin, Matthias Morys and Kevin O’Rourke, “Globalization 1870-1914,” in Stephen Broadberry and Kevin O’Rourke (eds), The Cambridge Economic History of Modern Europe, Volume 2 (Cambridge 2010), 6-29 Hall, Peter A. and David Soskice, “Introduction” from Varieties of Capitalism, edited by Peter A. Hall and David Soskice, Oxford University Press, 2001, 1-68

III. Globalization: How to Interpret It Jagdish Bhagwati, In Defense of Globalization, Oxford University Press 2004, Chapter One: Anti- Globalization: Why? 3-27 Fischer, Stanley, “Globalization and Its Challenges,” American Economic Review Papers and Proceedings, May 2003, 1 – 30 Frankel, Jeffrey, "Globalization of the Economy," in Governance in a Globalizing World, edited by Joseph S. Nye and John D. Donovan, Brookings, 2000, 45-71 Stiglitz, Joseph E, The Overselling of Globalization, in Weinstein, Globalization, What's New, Columbia University Press 2005, 228-261 Hirschman, Albert, Rival Interpretations of Market Society: Civilizing, Destructive of Feeble? Journal of Economic Literature 1982. 20:1463-1484 Easterly, William. "Globalization." The New Palgrave Dictionary of Economics, Second Edition, ed Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008 Keohane, Robert O, and Joseph S. Nye, Introduction, in Governance in a Globalizing World, ed by Nye and John Donahue, Brookings 2000, 1-41 Sachs, Jeffrey D., Globalization and Patterns of Economic Growth, in Globalization What's New? edited by Michael Weinstein, Council of Foreign Relations, 2005, Columbia University Press, 214-227

IV. Globalization: How Economics, Politics, History, Ethics Helps to Understand It Fourcade Marion, Etienne Ollion and Yann Algan, “The Superiority of Economics,” Journal of Economics Perspectives, Vol 29, No 1, 2015, 89-114 Sandel, Michael, “Market Reasoning as Moral Reasoning,” Journal of Economic Perspectives, 2013, Fall, 121-140 David, Paul, "Clio and the Economics of QWERTY," American Economic Review, 1985, 75:2, May, 332-337 Uhlig, Harald, Economics and Reality, NBER WP 16416, 2010, 1-8 to read Acemoglu, Daron and James A. Robinson, “Economics versus Politics,” Journal of Economic Perspectives Vol 27, No 2 Spring 2013, 173–192

Nunn, Nathan, "The Importance of History for Economic Development," Annual Review of Economics, 2009, 1, 65-92 Solow, Robert M, “Economic History and Economics” American Economic Review, 1985, 75:2, May, 328-331 Keynes, John Maynard, “Essays in Persuasion,” ‘Economic Possibilities for Our Grandchildren,’ New York, W.W. Norton, 1963, 358-373 Page | 3 Guiso, Luigi, Paola Sapienza, Luigi Zingales. 2006. "Does Culture Affect Economic Outcomes?" Journal of Economic Perspectives, Vol 20, 23-48 Peter Singer, One World, The Ethics of Globalization, Yale University Press, 2002 Acemoglu, Daron, “Root Causes: A Historical Approach to Assessing the Role of Institutions in Economic Development,” Finance & Development, June 2003 http://www.imf.org/external/pubs/ft/fandd/2003/06/pdf/acemoglu.pdf

V. Radical Response to Earlier Globalization: Emergence of Communist Economies and the Way Back Ericson, Richard, Command Economy, the New Palgrave, Second Edition 2008, edited by N. Durlauf and Lawrence E. Blume Ofer, Gur, Soviet Growth Record, the New Palgrave Dictionary of Economics, Second Edition 2008 edited by N. Durlauf and Lawrence E. Blume Gregory Paul and Mark Harrison, Allocation under Dictatorship: Research in Stalin’s Archives, Journal of Economic Literature Vol. XLIII (September 2005), pp. 721–761 Ericson, Richard E., "The Classical Soviet-Type Economy: Nature of the System and Implications for Reform." Journal of Economic Perspectives 5: 4, Fall 1991, pp. 11-28 Dallin, Alexander, "Causes of the Collapse of the USSR," Post-Soviet Affairs, no. 4, 1992, pp. 279- 302 Allen, Robert, “The Rise and Decline of the Soviet Economy,” Canadian Journal of Economics 34:4 (2001), 859-881 Bergson, Abram, The USSR before the Fall: How Poor and Why, Journal of Economic Perspectives — Volume 5, Number 4 — Fall 1991 — Pages 29–44 Roland, Gerard, Transition and Economics, Politics, Markets and Firms, The MIT Press, 2000, Chapter 1 Understanding Transition, pp 1-22 Kornai, Janos. “The Great Transformation of Central Eastern Europe,” Economics of Transition 14:2, 2006, pp. 207-244 Aslund, Anders, The Transformation of Central and Eastern Europe, Russia and Central Asia, Cambridge University Press, 2007, Chapter Two, Shock Therapy versus Gradualism, pp. 29-56, Chapter Three, Output: Slump and Recovery, pp. 57-81, Chapter Five, From Hyperinflation to Financial Stability, pp. 104-142 Guriev, Sergei, and Andrei Rachinsky, The Role of Oligarchs in Russian Capitalism, Journal of Economic Perspectives—Volume 19, Number 1—Winter 2005—Pages 131–150 Estrin, Saul, Privatization impacts in transition economies, The New Palgrave Dictionary of Economics, Second Edition, 2008 Edited by Steven N. Durlauf and Lawrence E. Blume Bockman, Johanna and Gil Eyal 2002, Eastern Europe as a Laboratory of Economic Knowledge: The Transnational Roots of Neoliberalism. American Journal of Sociology 108(2), 310- 352

VI. Globalization: Issues in the International Monetary System Eichengreen, Barry and Peter Temin, "The Gold Standard and the Great Depression." Contemporary European History 9, 2 (2000): 183-207

Eichengreen, Barry, “Globalizing Capital. A History of the International Monetary System,” Princeton University Press, 1996, Chapter Three, The Interwar Period pp 43-90 Frankel Jeffrey, "No Single Currency Regime Is Right For All Countries Or At All Times", NBER Working Paper 7338, September 1999, Obstfeld Maurice, and Alan M. Taylor, Chapter 1, “Global Capital Markets: Overview and Origins,” in their Global Capital Markets: Integration, Crisis and Growth, Cambridge, Page | 4 University Press, 2004, pp. 4 – 41 de Grauwe, Paul, Economics of Monetary Union, Oxford University Press, 2012, Chapter 1 Posen, Adam S., Why the Euro will Not Rival the Dollar, International Finance, 11:1, 2008, pp. 75-100 Feldstein, Martin, “The Political Economy of the European Economic and Monetary Union: Political Sources of an Economic Liability,” Journal of Economic Perspectives, Fall 1997 pp. 23-42 Buiter, Willem H., Why the United Kingdom Should Join the Eurozone, International Finance, 11:3, 2008, pp. 269-282 Minford, Patrick, Why the United Kingdom Should Not Join the Eurozone, International Finance, 11:3, 2008, pp. 283-295

VII. Globalization: Different Types of Crisis and Responses to Them Berg, Andrew, “The Asian Crisis: Causes, Policy Responses and Outcomes,” IMF Working Paper no. 99/138, October 1999 Mishkin, Frederic S., Over the Cliff: From the Subprime to the Global Financial Crisis, Journal of Economic Perspectives—Volume 25, Number 1—Winter 2011—Pages 49–70 Reinhart, Carmen M., and Kenneth S. Rogoff This Time is Different: A Panoramic View of Eight Centuries of Financial Crises NBER Working Paper, 2008, 13882, March Lane, Philip R., The European Sovereign Debt Crisis, Journal of Economic Perspectives, 2012, Summer, Volume 26, Number 3, 49–68 Rodrik, Dani, One Economics, Many Recipes, Princeton University Press, 2007, Introduction, pp 1-10, Chapter 1, Fifty Years of Growth (and Lack Thereof): an Interpretation, 13-53 Schmidt Vivian, “What Happened to the State-Influenced Market Economies (SMEs)? France, Italy and Spain confront the Crisis as the Good, the Bad, and The Ugly,” in The Consequences of the Global Financial Crisis: The Rhetoric of Reform and Regulation. eds. Graham Wilson and Wyn Grant. Oxford: Oxford University Press, 2012 Nye, Joseph. Is the American Century Over? Cambridge, UK: Polity Press, 2015 Summers Lawrence, “Reflections on the ‘New Secular Stagnation Hypothesis’,” in Richard Baldwin and Coen Teulings (eds), Secular Stagnation: Facts, Causes, and Cures, London: CEPR Press (2014), 27-41 Gordon, Robert, “The Turtle’s Progress: Secular Stagnation Meets the Headwinds,” in Richard Baldwin and Coen Teulings (eds), Secular Stagnation: Facts, Causes, and Cures, London: CEPR Press (2014), 47-60 Rodrik Dani, “An African Growth Miracle?” Paper written for Center for Global Development, Richard H. Sabot Lecture (2014) Rodrik Dani, “The Past, Present and Future of Economic Growth,” in Franklin Allen et al., “Towards a Better Global Economy (Oxford University Press, 2014)