midterm review questions 2023

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University of Minnesota-Twin Cities *

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4331W

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Economics

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Jan 9, 2024

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pdf

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When studying for the midterm, aim at being able to answer long questions (L) in 3-4 paragraphs and short questions (S) in 1-2 paragraphs. Data in Development 1. (L) Describe the three main sources of data in development and their relative strengths. 2. (S) “Thoughts without content are empty, impressions without concepts are blind.” Explain how the two parts of this quote represents the ideas of empiricism and structuralism. 3. (L) Explain how the Semmelweis and alcohol example illustrates how there can be both too much and too little depednence on theory. 4. (S) Explain using Semmelweis how data can falsify theories even though observation depends on theory. Material Well Being 1. (L) Explain how information about prices and wages can be used to derive a lower bound on labor productivity (or, equivalently, an upper bound on labor content). Why is the assumption of no loss-making central? 1. (L) Using appropriate numbers (within an order of magnitude), calculate the price per kWh of work using manual labor or electricity. Describe your calculations and the implications for the organization of production. 2. (S) Discuss the benefits and drawbacks of using a consumption survey to measure poverty. 3. (S) What are the main challenges with setting a poverty line to measure the number of people living in extreme poverty? 4. (L) How has extreme poverty evolved in the world over the last 30 years. Discuss some key main measurement issues? 5. (S) Discuss two drawbacks in using GDP per capita as a measure of poverty? 6. (S) List some ways in which GDP per capita growth might underestimate or overestimate the growth in material well-being.
7. (S) Do we see convergence in GDP per capita across countries in the world after WWII? Does it matter whether we weigh countries in terms of population or not? Health 1. (S) Explain the difference in focus when viewing health as an individual or social process. 2. (L) Discuss three measures of measure health in a society, and pros and cons of them. 3. (L) What are the key characteristics of the epidemiological transition? 4. (S) Explain why we see faster convergence across the world in health outcomes than in other dimensions. 5. (L) Explain the debate about the relationship between standards of living and nutrition on the one hand and life expectancy and child mortality on the other, starting from the McKeown hypothesis. 6. (S) Explain the Preston curve and why it has been interpreted as evidence for health not being fully determined by income. Education 1. (S) Describe the educational situation in poor countries post-WWII, and the evolution of educational attainment since then. 2. (S) Explain the investment perspective on education. 3. (S) Explain what symbolic cognition is and why it is believed to be important for development. 4. (S) What are the most important problems currently affecting educational systems in developing countries? 5. (S) Summarize the positive and negative aspects of educational development since WWII.
6. (L) What is the main challenge of designing cross-country standardized tests? Describe how PISA:s mathematical literacy measures seek to overcome this challenge. 7. (L) Explain how PISA defines the notion of “formulating” a problem mathematical. Explain how this is tested by the “Pizza” question in the notes. Demographic Transition 1. (S) What is a Malthusian Trap? Briefly describe Malthusian dynamics and the two mechanisms that allowed the world to escape Malthus’ predictions. 2. (L) Consider a world in which the land endowment is given by X , the technological level is given by B , and the population size is L . Total income is given by: ࠵? = ࠵? ࠵? ! ࠵? "#! Per capita income is: ࠵? = $ % = ࠵? (࠵?/࠵?) ! Population grows according to ࠵? ̇ /࠵? = ࠵?(࠵? − ࠵? ) where ࠵? , is the subsistence wage Use the graph below to analyze the short and long-run dynamics resulting from a one-time increase in the technology level B. To do this, draw two graphs with time on the horizontal axis, and output per capita and population on the vertical axis. 3. (L) What is the demographic transition? List the five aspects discussed in the lecture notes, and explain how they fit together. 4. (S) Briefly explain some reasons for why fertility rates have fallen in the world.
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5. (L) Use the lecture notes and the Ron Lee article to describe the consequences of the demographic transition for age structure, and describe the challenges that the world will face as a consequence. Urbanization 1. (S) What is urbanization? Describe its main determinants. 2. (L) Explain the relationships between the three graphs below. Use the equation ࠵? /࠵? = ࠵? /࠵? × ࠵? /࠵? × ࠵?/࠵? in your explanation.
3. (L) Explain the four terms in the equation below, and why this equation has to be true by definition. Explain the assumption that allows us to use this equation to determine the agricultural employment share, and explain two mechanisms that drive down agricultural employment as countries get richer: ࠵? /࠵? = ࠵? /࠵? × ࠵? /࠵? × ࠵?/࠵? . 4. (S) The graph below shows how capital per worker in agriculture versus the rest of the economy varies as a function of GDP per capita. Discuss what this means for agricultural employment using the equation ࠵? /࠵? = ࠵? /࠵? × ࠵? /࠵? × ࠵?/࠵? .