Outline

Overview

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

Unit code	ECOS3018
Academic unit	Economics
Credit points	6
Prohibitions ?	None
Prerequisites ?	(ECOS2001 or ECOS2901) and (ECOS2002 or ECOS2902)
Corequisites ?	None
Assumed knowledge ?	None
Available to study abroad and exchange students	Yes

Teaching staff

Coordinator	Graham White, g.white@sydney.edu.au

Type	Description	Weight	Due	Length
Final exam (Live+ supervised)	Final exam Final exam	60%	Formal exam period	2 hours
Outcomes assessed:
In-semester test (Record+)	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:
In-semester test (Record+)	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:
= Type A final 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	Description
High distinction	85 - 100	Understanding lecture material to an exceptional standard
Distinction	75 - 84	Understanding lecture material to a very high standard
Credit	65 - 74	Understanding lecture material to a good standard
Pass	50 - 64	Understanding lecture material to an acceptable standard
Fail	0 - 49	When you don’t meet the learning outcomes of the unit to a satisfactory standard.

For more information see sydney.edu.au/students/guide-to-grades.

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.

Learning support

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.

Weekly schedule

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

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

1. INTRODUCTION TO GROWTH THEORY

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

Reading:

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

Reading:

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

Reading:

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.

4. OPTIMAL GROWTH THEORY

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

Reading:

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.
(e-reserve)

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

Reading:

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

Reading:

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

Reading:

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.

8. GROWTH AND POLICY

· 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

Reading:

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.

9. A SUMMING-UP

Learning outcomes

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.

Outcomes
Graduate qualities

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
Learning outcomes

Responding to student feedback

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

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

Additional information

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.

Disclaimer

The University reserves the right to amend units of study or no longer offer certain units, including where there are low enrolment numbers.

To help you understand common terms that we use at the University, we offer an online glossary.

Current students

Overview

Overview

Unit details and rules

Teaching staff

Assessment

Assessment

Assessment summary

Assessment criteria

Late submission

Academic integrity

Learning support

Learning support

Simple extensions

Special consideration

Using AI responsibly

Weekly schedule

Weekly schedule

Attendance and class requirements

Study commitment

Required readings

Learning outcomes

Learning outcomes

Graduate qualities

Outcome map

Responding to student feedback

Responding to student feedback

Additional information

Additional information

Disclaimer

On this page

Useful links

Media

Student links

About us

Connect

Current students

ECOS3018: Economics of Growth

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

Overview

Overview

Unit details and rules

Teaching staff

Assessment

Assessment

Assessment summary

Assessment criteria

Late submission

Academic integrity

Learning support

Learning support

Simple extensions

Special consideration

Using AI responsibly

Weekly schedule

Weekly schedule

Attendance and class requirements

Study commitment

Required readings

Learning outcomes

Learning outcomes

Graduate qualities

Outcome map

Responding to student feedback

Responding to student feedback

Additional information

Additional information

Disclaimer

On this page

Useful links

Media

Student links

About us

Connect