Summary: Last class we learned about the Solow Growth model. Today we will learn about one of its main insights, the idea that the growth rates of poor countries and rich countries should converge over time ("catch-up effect").
Inquiry Question: To what extent has the idea of convergence proved true in reality?
Listen to this podcast. Focus on this question as you listen: "Solow contends that capital accumulation cannot explain a significant portion of the economic growth we see." If capital accumulation does not explain economic growth, what does according to Solow?
Formative Assessment: You will have an assessment at the beginning of class. There will be three questions. I will use this rubric to assess your work.
Question #1 will be from my lecture (content knowledge).
Question #2 will be based on the podcast you listened to for homework (critical thinking).
Question #3 will require you to transfer what you've learned to a new problem (creativity).
Lecture: Convergence
Listen to this podcast. Focus on this question as you listen: Why are poor people poor and what is the best way to study that problem?
How should we think about growth and poverty? How important is the goal of reducing the proportion of the world's population living on less than a dollar a day? Does poverty persist because people lack skills or because they live in economic systems where skills are not rewarded? What is the role of experimental methods in understanding what reduces poverty? Author and economist Lant Pritchett of Harvard University talks with EconTalk host Russ Roberts about these questions and more in a wide-ranging discussion of how best to help the world's poorest people.