Theory, General Equilibrium, and Political Economy in Development Economics
AbstractI discuss the role of economic theory in empirical work in development economics with special emphasis on general equilibrium and political economy considerations. I argue that economic theory plays (should play) a central role in formulating models, estimates of which can be used for counterfactual and policy analysis. I discuss why counterfactual analysis based on microdata that ignores general equilibrium and political economy issues may lead to misleading conclusions. I illustrate the main arguments using examples from recent work in development economics and political economy.
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Bibliographic InfoArticle provided by American Economic Association in its journal Journal of Economic Perspectives.
Volume (Year): 24 (2010)
Issue (Month): 3 (Summer)
Other versions of this item:
- Daron Acemoglu, 2010. "Theory, General Equilibrium and Political Economy in Development Economics," NBER Working Papers 15944, National Bureau of Economic Research, Inc.
- D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
- O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
- P00 - Economic Systems - - General - - - General
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- Theory, General Equilibrium and Political Economy in Development Economics
by Christian Zimmermann in NEP-DGE blog on 2010-05-13 00:31:06
- Pablo Selaya & Eva R. Sunesen, 2008.
"Does Foreign Aid Increase Foreign Direct Investment?,"
08-04, University of Copenhagen. Department of Economics.
- Selaya, Pablo & Sunesen, Eva Rytter, 2012. "Does Foreign Aid Increase Foreign Direct Investment?," World Development, Elsevier, vol. 40(11), pages 2155-2176.
- Gnidchenko, Andrey, 2011.
"Моделирование Технологических И Институциональных Эффектов В Макроэкономическом Прогнозировании
[Technologica," MPRA Paper 35484, University Library of Munich, Germany, revised May 2011.
- Juergen Jung & Chung Tran, 2011.
"The Extension of Social Security Coverage in Developing Countries,"
2011-06, Towson University, Department of Economics, revised Nov 2011.
- Jung, Juergen & Tran, Chung, 2012. "The extension of social security coverage in developing countries," Journal of Development Economics, Elsevier, vol. 99(2), pages 439-458.
- Chung Tran & Juergen Jung, 2007. "The Extension of Social Security Coverage in Developing Countries," Caepr Working Papers 2007-026, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington.
- Miguel Szekely, . "Toward Results-Based Social Policy Design and Implementation - Working Paper 249," Working Papers 249, Center for Global Development.
- Olofsgård, Anders, 2012. "The Politics of Aid Effectiveness: Why Better Tools can Make for Worse Outcomes," SITE Working Paper Series 16, Stockholm Institute of Transition Economics, Stockholm School of Economics.
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