ECON 255

Winter 2017-18
Section 2
Understanding Globalization
Course Outline
Instructor: Ashok Kotwal
Office: Iona Building #201C
Office hours: MW 2-3.30 pm.
E-mail address: ashok.kotwal@ubc.ca
TAs: Tanya Sharma, Tudor Schlanger

TAs’ emails: 97tanyasharma@gmail.com, tudor.schlanger@gmail.com

TA Office Hours: Tanya (Tu 2 – 3.30); Tudor (Thrs 2 – 3.30)

TA Offices: Iona # 233

Course web pages: https://canvas.ubc.ca/

and use your CWL to log in.

Textbook: Selected chapters from International Trade by Robert

Feenstra and Alan Taylor (FT) (3nd Edition), Worth.
(available in UBC Bookstore as a course package).

What is the course about?

Globalization often generates heated debate. It is especially so now. On one
hand, globalization can be credited with the reduction of poverty of millions in
China and India. On the other hand, it has caused turmoil in the developed
world. The past two years have been particularly puzzling. The rising
resentment against trade and immigrants has resulted in the ascent of right-
wing nationalism in the U.S. as well as Europe.
Globalization has the potential to diffuse technologies and knowledge across
the world no matter where it is discovered. It can make savings generated in
one country available for investment in another. Its advocates highlight its
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promise to lift entire populations out of poverty through trade and economic
growth. Its detractors argue that it does this at the expense of workers in
developed countries, increases inequality and undermines democratic
mandates of national governments. Is globalization a zero-sum game across the
world?
These debates will be at the centre of the course.

How does the course work?

The good thing is that all the material is very interesting and it may answer
some of the long-standing questions we all have about how the world works.
But at the same time, the course is different from any other course you have
had. Its scope is very broad. In a part of the course, we will follow the textbook
and do analytical problem sets to understand the theory underlying various
aspects of globalization. Here you will be on more familiar grounds – models,
graphs and algebra, assignments etc. But for a large part of the course, we will
use outside material based on current research. We will have a lot of class
discussions based on pre-assigned readings. This will be the hard part as in
most economics courses you may not have encountered such broad based
discussions. This part of the course may seem to you like a political science
course.
For your tutorials (discussion groups), you will have to do some joint research
on the assigned topic and make class presentations.
Each week, there will be two 80 min lectures and a 50 min tutorial. The lectures
and tutorials will cover different material, all of which will be examinable. In
the lectures, you will need to be prepared to participate in discussion and in-
class exercises. Missing lectures will be very costly as I go through material in
the class that may not be accessible to you easily. Please note that I like to
deviate from the planned lectures quite often. It is a good idea to take notes
and rely on them. Please note that you have to keep your laptops off
during the lectures.
In the tutorials, you will be expected to make presentations on the assigned
topics and to participate in a discussion on your classmates’ presentations. Your
participation in tutorials will determine a significant portion of your grade.
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I will post Problem Sets (to be done jointly as group projects) in Canvas. Please
try not to free ride on the efforts of your group members. If you do not do the
assignments, you will not be able to do well in the exams.
Anything I send over the university’s broadcast email will be considered an
official communication. It is your responsibility to ensure that your email
address on your SSC profile works. Before the first class, you should have
received a test message from me. If you have not, please solve the problem as
soon as possible.

Grading
The grading scheme for the course is as follows:
- Tutorials presentations (group): 15%
- Tutorial participation: 05%
- Problem Sets (group): 15%
- Midterm: 25%
- Final (comprehensive): 40%

Jan 2 Introduction to the course

Jan 7 Globalization as a Process and the Elephant Curve
(Lecture Notes)
https://www.youtube.com/watch?v=915yv1_e66I
Based on Richard Baldwin’s The Great Convergence: Information
Technology and the New Globalization, 2016.

Based on Ch.1, Global Inequality: A New Approach for the Age of

Globalization by Branko Milanovic.

Jan 9 Distributional Consequences of Trade –Specific

Factor Model
(FT - Ch. 3)
Jan 14, 16 East Asian Model of Development
Dual Economy Model of Development (Lecture Notes)
Based on “Theory of Real Wage Growth” by Eswaran and Kotwal in
Journal of Development Economics, June 1993.

“How South Korea and Taiwan Grew Rich?” by Dani Rodrik (in
Canvas).
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Jan 21 Off-Shoring (FT Ch. 7)

Jan 23 Role of Globalization in Chinese Development

(Lecture Notes)
Based on: “Understanding Chinese Growth: Past, Present and
Future” by K. Zhu in Journal of Economic Perspectives, Fall 2012.

Problem Set #1 due on Jan 28

Jan 28 Role of Globalization in Indian Development

(Lecture Notes)
Based on: “Economic Liberalization and Indian Economic
Growth: What’s the Evidence?” by Kotwal, Ramaswami and Wadhwa
in the Journal of Economic Literature, December 2011.

Jan 30 Resentment of Workers in the West

Autor, D, D Dorn and G Hanson (2013) “The China syndrome: Local labor
market effects of import competition in the United States”, American
Economic Review, 103: 2121-2168.

Anne Case and Angus Deaton : “Rising Morbidity and Mortality in Midlife
among White Non-Hispanic Americans in the 21st Century”. Proceedings of
National Academy of Sciences, Nov 2015.

https://www.youtube.com/w atch?v=oXl3UTcuBJ4
http://voxeu.org/article/brexit-and-globalisation
http://voxeu.org/article/globalisation-and-brexit

Feb 4, 11 Immigration (Lecture Notes)

Feb 13 Midterm

Feb 18 thru’ 22 Study Break

Feb 25, 27Asian Crisis (Lecture Notes)

Mar 4, 6 Tariffs
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FT Ch.8
Mar 11,13 Technology and Widening Inequality (Lecture Notes)
https://www.youtube.com/watch?v=PR8OkkfvnT8
Based on: Alvaredo et al “The Top 1% in International and
Historical Perspective” (JEP 2013) and Piketty’s “Capital”.

Problem Set #2 due on March 4

M 18,20 Markets and Justice (Lecture Notes)

Pareto Efficiency and Core, Rents, Hayek, Nozick

M 25,27 Utilitarianism (Lecture Notes)

https://www.youtube.com/watch?v=0O2Rq4HJBxw
https://www.youtube.com/watch?
v=Qw4l1w0rkjs&t=156s
April 1,3 Rawls Theory of Justice, Dworick, Luck egalitarians
and critics (Lecture Notes)

Problem Set #3 due on April 3

Tutorials:

You must attend all tutorials – attendance will be taken at the beginning of
class and factored into your grade. Tutorials start the week of January 7th and
run until the end of the semester. Attending and participating in tutorials is
required to pass the course.
Week of Topic
Jan 07 Organizational meeting.

Jan 14 A Conversation on Global Inequality

https://www.youtube.com/watch?v=76FsIlO06Xs
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https://www.youtube.com/watch?v=bsy349k3zds

Jan 21 The Great Escape by Angus Deaton

https://www.youtube.com/watch?v=XwLNqDbPNBw

Jan 28 Technological Stagnation

https://www.youtube.com/watch?v=TIHGOo7OC8c
https://www.ted.com/talks/robert_gordon_the_death_of_in
novation_the_end_of_growth

Feb 4 Forgotten Working Classes in U.S. and U.K.

https://www.ted.com/talks/j_d_vance_america_s_forgotten
_working_class
https://www.youtube.com/watch?v=WMafVnxchxc
https://www.youtube.com/watch?v=6gZ5UD1hFM4

Feb 11 No tutorials (Midterm week)

Feb 18 No tutorials (Study Break)

Feb 25 Crisis in Multiculturalism

https://www.youtube.com/watch?v=pCG2xJDtnwo
https://www.youtube.com/watch?v=MHplEJgevqM

Mar 4 Behaviour Economics and Poverty by S. Mullianathan

https://www.youtube.com/watch?v=u6_scuce5TA&t=4357s

Mar 11 Machines replacing Humans

https://www.youtube.com/watch?v=w2lDmF8ZShI
https://www.youtube.com/watch?v=JUnUgcppr0Y

Mar 18 Radical Redistribution Policies

https://www.youtube.com/watch?v=EefzHbTArtY
https://www.youtube.com/watch?v=7P9o1WBnM3E
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Mar 25 Fairness
https://www.youtube.com/watch?
v=VcL66zx_6No&ind=8&list=PL30C13C91CFFEFEA6
https://www.youtube.com/watch?
v=AUhReMT5uqA&list=PL30C13C91CFFEFEA6&index=9
Apr 1 Liberalism
https://www.youtube.com/watch?v=_G6NVP6Yn0c

https://www.youtube.com/watch?v=poq5ZrAc7pk&t=1188s