Microeconomic Approaches to Development: Schooling, Learning, and Growth

Within the field of economic development over the past 15 years or so, particularly significant advances have been made in what can be loosely called micro-development, an area defined principally by the units that are examined, not by a particular methodological approach. The units may be individuals, households, networks, banks, government agencies and so on, as opposed to countries. Within this area, economists use a wide variety of empirical methods informed to different degrees by economic models, they use data from developed and developing countries, and some use no data at all, to shed light on development questions. The best of this work speaks to the major questions of development and even informs, if not provides the foundation for, macro models of development and growth. I will illustrate the variety of approaches to development issues that microeconomists have employed by focusing on studies that illuminate and quantify the major mechanisms posited by growth theorists who highlight the role of education in fostering growth.