Seminar: Fundamental Determinants of Economic Outcomes
The broad question asked is “Why are some societies richer than others?” The proximate answer is that societies that have ended up with higher development levels have done so, because of higher productivity and investment rates in human- and physical capital. But why is it that some societies are so much more productive and invest more than others? The answers can be grouped into three categories: institutions, culture, and geography. The purpose of this seminar is to identify causes and consequences of these three “deep determinants of economic growth” econometrically.
Students choose which of the three deep determinants they want to investigate, pose a relevant question, and then conduct the econometric analysis necessary to answer the question.
Choice of topic: Choose one of the deep determinants and investigate either its’ origins or its’ consequences for an economically relevant outcome variable. After that, choose whether to replicate an existing paper partly or to conduct your own empirical analysis. Examples of topics that are relevant for this seminar:
- Students are welcome to choose topics from the Economic History course, but having taken Economic History is not a requirement for taking this seminar.
- The institutions of a country provide the formal rules within which we make decisions, and thus influence economic outcomes in various ways. Which institutions are good for growth and which are bad? And why do some countries develop “bad” institutions, while others end up with “good” institutions?
- Our cultural values influence the decisions we make, including our economic decisions. Various economic outcomes have been linked to culture; fertility choices, labor force participation, health, etc. Even GDP per capita has been associated with differences in cultural values, such as individual religiosity, thriftiness, preferences for hard work, patience etc. But how does religiosity or patience influence growth or other economically relevant outcomes such as science development or investments? And why are some societies more religious, thrifty or patient than others?
- Peeling off the layers of the onion in our search for the ultimate deep determinants of economic outcomes brings us back into history. Back then, all societies relied on agriculture and, thus, the deep roots of current economic differences is likely to involve differences in agriculture practices. These practices are highly dependent on the geographic and climatic surroundings of historic societies. In fact, certain geographic and climatic circumstances did influence economic outcomes of past societies, and these historic differences explain a major part of current economic differences.
Endogeneity problems will play an important role in the empirical work. For instance, when investigating the impact of institutions on GDP per capita, OLS analysis will include particularly two types of endogeneity bias; institutions and GDP per capita may both be influenced by various omitted factors (omitted variables bias), and GDP per capita levels may influence the quality of institutions (reverse causality bias). Students do not have to solve these endogeneity problems perfectly econometrically in order to pass the seminar, but the minimum criterion to pass is proper OLS regression analysis combined with a discussion of endogeneity issues.
You are very welcome to contact me before the semester starts if you want my opinion on a paper that you want to use or a topic that you want to investigate: Jeanet.firstname.lastname@example.org. This is by no means necessary, though. You will get time and guidance within the seminar to choose your topic.
I am looking much forward to meeting you all! This will be the fourth round of the seminar and I always find my discussion with all of you very engaging. Here are some extracts from what previous students thought about the seminar:
- “great and regular feedback, very detailed and helpful”
- “facilitated open atmosphere: no question was too dumb, really felt like you can reach out to Jeanet every week with all the concerns one might have”
- “I liked the seminar a lot, both the subject and the setup. Jeanet was enthusiastic and engaged and very well prepared. The classes and assignment during the course was needed to get started from the beginning, which always is tricky. The first introductions to the three determinants was very informative, since it can be a bit hard to know exactly what is targeted in the class. The feedback was constructive and clear, I felt that I knew what was required of me and how to proceed. I always felt comfortable to ask for help and guidelines.”
Students will learn how to phrase a relevant research question.
Students will learn how to motivate their question in an interesting way and how to transform a hypothesis into something that can be tested empirically.
Students will learn how to conduct an econometric analysis of macroeconomic questions. In particular, students will learn how to think about which endogeneity problems that are crucial in the particular analysis and how to solve them.
Students will learn how to write a good paper by setting up a hypothesis, motivating why it is relevant, describing how to test it, and last testing it.
- Last, the students, who choose to do so, will learn how to use ArcGIS technology to transform any information with a spatial dimension (road density, average precipitation, distance to coast, vicinity to a boarder, etc) into variables that can be used for econometric analysis.
- Kick-off meeting: First week of February
- Extra meetings / introductory teaching / guidance:
In-class teaching: We will meet in class three times (1-2 hours each) in September, and again twice (1 hour each) in October.
- Supervision: Throughout the semester, I will have supervision meetings with those who find this necessary.
- Feedback on writing: I will ask you to hand in your critique of chosen papers in September, a preliminary first results table end of March, and preliminary first paragraph of introduction end March. The two latter will be followed by short practical lectures on econometrics and writing.
- Deadline for submission of commitment paper / project description: 1 March.
(good idea to have found your main paper and main data by then)
- Deadline for uploading a seminar assignment paper in Absalon: 16 May
- Presentations: 23 May.
- Exam date: 1 June at 10.00 (am) - latest uploading of Seminar paper to the Digital Exam portal for assessment.
- Latest date for assessors and censors to enter the grade in the Digital Exams portal. The date cannot be changed: June 29
Relation to subjects and courses
It is strongly recommended to have a basic knowledge of simple regression analysis from “Econometrics I” from the Bachelor of Economics, University of Copenhagen or similar courses.
Students will benefit greatly from having followed courses on applied econometrics, similar to "Applied Econometric Policy Evaluation" at the Bachelor and Master of Economics, University of Copenhagen.
In the analysis of economic growth and development, the course complements the course and to a lesser extent ”Economic Growth”.
Students will benefit some from having taken the courses ”Advanced Development Economics – Macro Aspects”, ”Economic History”, and long-run macro from “Macroeconomics I”, or similar courses.
The seminar will involve various journal articles and recent working papers. Below, I list selected overview articles:
- Acemoglu, D. (2009) Fundamental Determinants of Differences in Economic Performance, Introduction to Modern Economic Growth Chapter 4, Princeton University Press. Online: http://www.ppge.ufrgs.br/giacomo/arquivos/eco02237/acemoglu-2007.pdf
- Guiso, L., P. Sapienza, and L. Zingales, Does Culture Affect Economic Outcomes? Journal of Economic Perspective 20 (2006):23–48.
- Nunn, N. (2014) Historical Development, Handbook of Economic Growth Vol 2, Chapter 7, pp. 347-402, doi:10.1016/B978-0-444-53538-2.00007-1.
Some more specific papers for inspiration are:
- Comin, D. A., Easterly, W., and E. Gong (2008) Was the Wealth of Nations Determined in 1000 BC? Working Paper 09-052.
- Dell, M. (2010) The Persistent Effects of Peru’s Mining MITA, Econometrica 78 (6).
- Dell, M., Jones, B. F., and B. A. Olken (2013) What Do We Learn from the Weather? The new Climate-Economy Literature, Journal of Economic Literature.
- Michalopoulos, S. and E. Papaioannou (2014) National Institutions and Subnational Development in Africa, The Quarterly Journal of Economics, 151-213.
- Nunn, N. and L. Wantchekon (2011) The Slave Trade and the Origins of Mistrust in Africa, American Economic Review, 101, 3221-3252.
- Voigtländer, N. and H.-J. Voth (2012) Persecution Perpetuated, Quarterly Journal of Economics, 1339-1392.
Students have to master Econometrics I well (regression
analysis: OLS, IV, panel data). This includes having a good
intuition behind the econometrics, for instance: What does OLS
really do? What does an interaction term mean? What does
endogeneity really mean?
Additional courses that will benefit your outcome of this seminar (but that are not required for a good grade) are Macro I (long run macro), Economic History, Advanced Development – Macro Aspects, and Advanced Microeconometrics.
BSc in Economics or similar.
- Kick-off meeting: Week 6
- Deadline for submission of commitment paper / project description: No later than 1 March
- Deadline for uploading a seminar assignment paper in the Digital Exam portal: No later than one week before the presentations.
- Presentations: 1-23 May
- Exam date: 1 June at 10.00 AM - latest uploading of Seminar paper to the Digital Exam portal for assessment.
- Deadline for assessment: 29 June
All information regarding the seminar is communicated through Absalon including venue. It is very important that you by yourself log on to Absalon and read the information already when you are registered at the seminar.
Throughout the seminar, the students will be able to get personal feedback on their ideas in class or through personal meetings with me. In the initial phase where students choose their topics, they will also receive peer feedback in groups, where they present their ideas to each other. The students will have the option to hand in early extracts of their thesis, which I will provide written comments on
- 7,5 ECTS
- Type of assessment
- Type of assessment details
- A seminar paper in English that meets the formal requirements
for written papers stated in the curriculum of the Master programme
and at KUNet for seminars.
- All aids allowed
Use of AI tools is permitted. You must explain how you have used the tools. When text is solely or mainly generated by an AI tool, the tool used must be quoted as a source.
- Marking scale
- 7-point grading scale
- Censorship form
- External censorship
Criteria for exam assessment
Students are assessed on the extent to which they master the learning outcome for the seminar and can make use of the knowledge, skills and competencies listed in the learning outcomes in the Curriculum of the Master programme.
To receive the top grade, the student must with no or only a few minor weaknesses be able to demonstrate an excellent performance displaying a high level of command of all aspects of the relevant material.
- Project work
- Course number
- 7,5 ECTS
- Programme level
- Full Degree Master
Go to "Remarks"
Exam and re-sits: Go to "Exam"
- Maximum number of classes: 2 / maximum number of students in each class (between 16 and 20): 20
- Department of Economics, Study Council
- Department of Economics
- Faculty of Social Sciences
- Jeanet Sinding Bentzen (14-746f6b786f7e386c6f787e846f784a6f6d797838757f386e75)
Jeanet Sinding Bentzen / email@example.com / hpv239
Are you BA- or KA-student?
Courseinformation of students