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Unit outline_

ECOS3018: Economics of Growth

Semester 2, 2020 [Normal day] - Camperdown/Darlington, Sydney

At the heart of an understanding of the dynamics of market or capitalist economies is an understanding of economic growth. This unit is an introduction to the analysis of economic growth including a comparison of competing explanations within formal growth theory. It considers the connection between growth and distribution, growth and technical progress, the role of economic policies and economic institutions in promoting growth as well as the limitations on growth associated with exhaustible natural resources. Lectures also provide some consideration of the empirical evidence on different explanations of growth.

Unit details and rules

Academic unit Economics
Credit points 6
(ECOS2001 or ECOS2901) and (ECOS2002 or ECOS2902)
Assumed knowledge


Available to study abroad and exchange students


Teaching staff

Coordinator Graham White,
Type Description Weight Due Length
Final exam (Live+ supervised) Type A final exam Final exam
Final exam
60% Formal exam period 2 hours
Outcomes assessed: LO1 LO2
In-semester test (Record+) Type B in-semester exam Mid-semester exam #1
Mid-semester exam
20% Week 07
Due date: 16 Oct 2020 at 18:00

Closing date: 16 Oct 2020
50 minutes
Outcomes assessed: LO1 LO2
In-semester test (Record+) Type B in-semester exam Mid-semester exam # 2
Mid-semester exam
20% Week 08
Due date: 23 Oct 2020 at 18:00

Closing date: 23 Oct 2020
50 minutes
Outcomes assessed: LO1 LO2
Type A final exam = Type A final exam ?
Type B in-semester exam = Type B in-semester exam ?
Type B in-semester exam = Type B in-semester exam ?

Assessment summary

Detailed information for each assessment can be found on Canvas.

Assessment criteria

The University awards common result grades, set out in the Coursework Policy 2014 (Schedule 1).

As a general guide, a High distinction indicates work of an exceptional standard, a Distinction a very high standard, a credit a good standard, and a pass an acceptable standard.

Result name

Mark range


High distinction

85 - 100

Understanding lecture material to an exceptional standard


75 - 84

Understanding lecture material to a very high standard


65 - 74

Understanding lecture material to a good standard


50 - 64

Understanding lecture material to an acceptable standard


0 - 49

When you don’t meet the learning outcomes of the unit to a satisfactory standard.



For more information see guide to grades.

Late submission

In accordance with University policy, these penalties apply when written work is submitted after 11:59pm on the due date:

  • Deduction of 5% of the maximum mark for each calendar day after the due date.
  • After ten calendar days late, a mark of zero will be awarded.

Academic integrity

The Current Student website  provides information on academic integrity and the resources available to all students. The University expects students and staff to act ethically and honestly and will treat all allegations of academic integrity breaches seriously.  

We use similarity detection software to detect potential instances of plagiarism or other forms of academic integrity breach. If such matches indicate evidence of plagiarism or other forms of academic integrity breaches, your teacher is required to report your work for further investigation.

You may only use artificial intelligence and writing assistance tools in assessment tasks if you are permitted to by your unit coordinator, and if you do use them, you must also acknowledge this in your work, either in a footnote or an acknowledgement section.

Studiosity is permitted for postgraduate units unless otherwise indicated by the unit coordinator. The use of this service must be acknowledged in your submission.

Simple extensions

If you encounter a problem submitting your work on time, you may be able to apply for an extension of five calendar days through a simple extension.  The application process will be different depending on the type of assessment and extensions cannot be granted for some assessment types like exams.

Special consideration

If exceptional circumstances mean you can’t complete an assessment, you need consideration for a longer period of time, or if you have essential commitments which impact your performance in an assessment, you may be eligible for special consideration or special arrangements.

Special consideration applications will not be affected by a simple extension application.

Using AI responsibly

Co-created with students, AI in Education includes lots of helpful examples of how students use generative AI tools to support their learning. It explains how generative AI works, the different tools available and how to use them responsibly and productively.

WK Topic Learning activity Learning outcomes
Weekly See Additional Information for Lecture Topics and Reading Guide Block teaching (3 hr) LO1 LO2

Attendance and class requirements

  • Attendance: According to Faculty Board Resolutions, students in the Faculty of Arts and Social Sciences are expected to attend 90% of their classes. If you attend less than 50% of classes, regardless of the reasons, you may be referred to the Examiner’s Board. The Examiner’s Board will decide whether you should pass or fail the unit of study if your attendance falls below this threshold.

  • Lecture recording: Most lectures (in recording-equipped venues) will be recorded and may be made available to students on the LMS. However, you should not rely on lect  ure recording to substitute your classroom learning experience.

    • Preparation: Students should commit to spend approximately three hours’ preparation time (reading, studying, homework, essays, etc.) for every hour of scheduled instruction.

Study commitment

Typically, there is a minimum expectation of 1.5-2 hours of student effort per week per credit point for units of study offered over a full semester. For a 6 credit point unit, this equates to roughly 120-150 hours of student effort in total.

Required readings

Lecture Topic and Reading Guide

Your grade in this unit will be based on your understanding of lecture material. Copies of the Powerpoint slides used in lectures should not be seen as a substitute for lecture notes. They contain diagrams and algebra used in lectures as well as a fairly cryptic listing of key points. Please bear in mind that students will be examined on their understanding of the material covered in the unit  and not on their ability to memorise bits and pieces of Powerpoint slides.

Lecture Topics


  • ·      Production, distribution and growth: some basic analytical tools
  • ·      Duality in one and two-sector growth models




Pasinetti, L.L. (1977), Lectures in the Theory of Production. London: Macmillan, Ch.3. (e-reserve) 

Kurz H.D. and Salvadori N. (1995), Theory of Production: A Long-Period Analysis. Cambridge: Cambridge University Press. Ch. 2 pp. 44-48. (e-reserve)



2. THE THEORY OF ECONOMIC GROWTH: early Keynesian inspired models

  • ·      From static to dynamic analysis
  • ·      Keynes’s problem of effective demand in a long-run setting
  • ·      The “Harrod-Domar” model: self-sustaining growth
  • ·      The steady state and unemployment equilibrium
  • ·      Harrod’s stability problem
  • ·      Harrod’s uniqueness problem



Dobb M. (1973), Theories of Value and Distribution since Adam Smith: Ideology and Economic Theory. Cambridge: Cambridge University Press. Ch. 8 pp.225-229, 232-34.

Kregel J. A. (1987), “Natural and warranted rates of growth”. Eatwell J., Milgate M. and Newman P. (eds.), The New Palgrave: A Dictionary of Economics. London: Macmillan (hereafter NP), Vol. III, pp. 600 – 602. (e-reserve)

Eltis W. (1987), “Harrod-Domar growth model”. NP, Vol. II, pp. 602 – 604. (e-reserve)

Hahn F. and Matthews R. C. O. (1964), The Theory of Economic Growth: A Survey, Economic Journal, Vol. 74, No. 296, pp. 783-84. (e-reserve) (hereafter HM)

The major original references are:

Harrod R.F. (1939), “An Essay in Dynamic Theory”. Economic Journal.

Domar E. D. (1946), “Capital Expansion, Rate of Growth and Employment”. Econometrica.


3. traditional neoclassical growth theory i: THE SOLOW-SWAN MODEL

  • ·            Growth without technical progress: full-employment in the steady state
  • ·             Diminishing returns and the steady state
  • ·            Steady state growth rate and the saving propensity
  • ·             Distribution and growth in the traditional neoclassical growth model
  • ·             Harrod’s unemployment problem and flexibility in factor prices


HM  pp.787-93. (e-reserve)

Dobb M. (1973), op.cit., Ch. 8 pp.229-231.

Jones H. (1976), An Introduction to Modern Theories of Economic Growth. London: McGraw-Hill. Ch. 4, pp.66-86. (e-reserve)

The major original references are:

Solow R. M. (1956), “A Contribution to the Theory of Economic Growth”. Quarterly Journal of Economics.

Swan T. (1956), “Economic Growth and Capital Accumulation”. Economic Record.


  • ·            The golden rule of accumulation
  • ·            Competitive paths and optimal growth



Aspromourgos A. , Rees D. and White G., (2010) “Public debt sustainability and alternative theories of interest”. Cambridge Journal of Economics, Vol. 34, No. 3, section 3.

Piketty T. (2015),  “A Historical Approach to Property, Inequality and Debt: Reflections on Capital in the 21st Century” CESifo Forum, No.1, March.

Taylor L. (2016), “Veiled Repression: Mainstream Economics, Capital Theory, and the Distributions of Income and Wealth”, International Journal of Political Economy, 45: 167–181.



5. GROWTH AND ISSUES IN capital theory

  • ·            The aggregate production function  - does it exist?
  • ·            Reswitching and reverse capital deepening: the rate of profit, capital intensity and marginal productivity theory
  • ·            Flexible factor prices, factor proportions and the stability of steady state paths



Kurz H.D. (1987), "Capital theory: debates". NP, Vol. I, pp. 357-359. ( A more in-depth version of this Palgrave entry can be found in Kurz and Salvadori Theory of Production op.cit., Ch. 14, pp. 427-455). (e-reserve)

White G. (2015), “The new Keynesian view of aggregate demand: some reflections from a classical-Sraffian standpoint”, Cambridge Journal of Economics, Volume 39, Issue 3, 1 May 2015, Pages 825–842. Section 4.



6. MODERN marginalist growth theory  - “endogenous” OR “NEW”                growth THEORY


  • ·            Endogenous or “new” growth theory as a reaction to the Solow-Swan growth model: technical progress, diminishing returns and the role of saving in the Solow-Swan model
  • ·            Endogenous growth, the optimising consumer and the simple linear                                     production (AK) model
  • ·            Endogenous growth and labour as human capital
  • ·            Endogenous growth and R & D
  • ·            The significance of externalities for endogenous growth
  • ·            Some problems with “new” growth theory


Romer P. (1994), “The Origins of Endogenous Growth”. Journal of Economic Perspectives, Vol. 8,No. 1. (e-reserve)

Solow R. M. (1994), “Perspectives on Growth Theory”. Journal of Economic Perspectives, Vol. 8, No. 1. (e-reserve)

D’Agata A. and Freni G. (2003) “The structure of growth models: a comparative survey” in Salvadori (ed),The theory of economic growth : a 'classical' perspective op.cit., pp. 34-41. (e-reserve)

Lucas R.E. (1988), “On the mechanics of economic development”, Journal of Monetary Economics, Vol. 22, No.1, pp. 3- 42. (e-reserve)

Kurz H.D. (1997), “What Could the ‘New’ Growth Theory Teach Smith or Ricardo?” Economic Issues, Vol. 2, Part 2, September. (e-reserve)

Fine B. (2000) “Endogenous growth theory: a critical assessment”, Cambridge Journal of Economics, Vol. 24. (e-reserve)



7. “Cambridge” growth theory and MODERN post-   keynesian/                                        kaleckian growth models


  • ·            Harrod’s uniqueness problem, distribution and the saving propensity
  • ·            The Cambridge growth equation
  • ·            An endogenous rate of accumulation
  • ·            Steady state utilization
  • ·            “The paradox of thrift”
  • ·            Stagnationist and exhilarationist models


Dobb M. (1973), op.cit., Ch. 8 pp.229-231.

Blecker R.A. (2002), “Distribution, demand and growth in neo-Kaleckian macro-models”, in The economics of demand-led growth : challenging the supply-side vision of the long run / edited by Mark Setterfield. Cheltenham : Edward Elgar Pub, , pp. 129-138. (e-reserve)

White G. (2006), “Demand-led growth and the classical/Sraffian approach to value and distribution: Are they compatible?” in Salvadori N. (ed), Economic Growth and Distribution: On the Nature and Cause of the Wealth of Nations, London: Edward Elgar. (e-reserve)

Commendatore P., D’Acunto S., Panico C., and Pinto A. (2003), “Keynesian theories of growth”, in The theory of economic growth : a 'classical' perspective / edited by Neri Salvadori. Cheltenham, UK ; Northhampton, MA : Edward Elgar,. pp. 114 – 122.




  • ·            The scope for policy in traditional neoclassical growth models: economic policy and welfare
  • ·            The public sector in endogenous growth theory
  • ·            Fiscal policy, public debt and dynamic efficiency
  • ·            Policy and demand-led growth



Aspromourgos A. , Rees D. and White G., op.cit., sections 1, 2, 4 and . (e-reserve)

Reinhart C. M. and Rogoff K. S. (2010), “Growth in a Time of Debt” Paper prepared for the American Economic Review Papers and Proceedings.

Nersisyan Y. and Wray L. R., (2010),  “Does Excessive Sovereign Debt Really Hurt Growth? A Critique of This Time Is Different, by Reinhart and Rogoff”, Levy Economics Institute of Bard College Working Paper No. 603, June.




Learning outcomes are what students know, understand and are able to do on completion of a unit of study. They are aligned with the University's graduate qualities and are assessed as part of the curriculum.

At the completion of this unit, you should be able to:

  • LO1. demonstrate openness to new ways of thinking and appreciate the importance of intellectual curiosity and reflection as the foundation for continuous learning
  • LO2. critically evaluate underlying theories, concepts, assumptions, limitations and arguments in economics.

Graduate qualities

The graduate qualities are the qualities and skills that all University of Sydney graduates must demonstrate on successful completion of an award course. As a future Sydney graduate, the set of qualities have been designed to equip you for the contemporary world.

GQ1 Depth of disciplinary expertise

Deep disciplinary expertise is the ability to integrate and rigorously apply knowledge, understanding and skills of a recognised discipline defined by scholarly activity, as well as familiarity with evolving practice of the discipline.

GQ2 Critical thinking and problem solving

Critical thinking and problem solving are the questioning of ideas, evidence and assumptions in order to propose and evaluate hypotheses or alternative arguments before formulating a conclusion or a solution to an identified problem.

GQ3 Oral and written communication

Effective communication, in both oral and written form, is the clear exchange of meaning in a manner that is appropriate to audience and context.

GQ4 Information and digital literacy

Information and digital literacy is the ability to locate, interpret, evaluate, manage, adapt, integrate, create and convey information using appropriate resources, tools and strategies.

GQ5 Inventiveness

Generating novel ideas and solutions.

GQ6 Cultural competence

Cultural Competence is the ability to actively, ethically, respectfully, and successfully engage across and between cultures. In the Australian context, this includes and celebrates Aboriginal and Torres Strait Islander cultures, knowledge systems, and a mature understanding of contemporary issues.

GQ7 Interdisciplinary effectiveness

Interdisciplinary effectiveness is the integration and synthesis of multiple viewpoints and practices, working effectively across disciplinary boundaries.

GQ8 Integrated professional, ethical, and personal identity

An integrated professional, ethical and personal identity is understanding the interaction between one’s personal and professional selves in an ethical context.

GQ9 Influence

Engaging others in a process, idea or vision.

Outcome map

Learning outcomes Graduate qualities

This section outlines changes made to this unit following staff and student reviews.

No changes have been made since this unit was last offered.

Please note, the assessments in this unit is study differ from the handbook. Specifically, the final exam duration is 2 hours not 1.5 hours as listed in the handbook. 


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