Summary: Many factors influence economic growth and development. The economic choices that individuals make are an important part of that. The field of behavioral economics has developed new ideas in helping us to understand these choices in recent decades. Today we will begin to study these ideas.
Inquiry Question: How does poverty shape individual economic choices?
No homework due today.
Lecture: Lecture on economic behavior in developing countries. We will watch these videos. I will explain and answer questions.
Earning Money (3:37)
Spending Money (3:19)
Are the poor overwhelmed? (3:03)
Poverty and attention (3:17)
Watch: This tutorial on hypothes.is. We will be using this tool to annotate readings as a group.
Read: 2015 World Development Report (Overview - pages 1-13 only). Make at least two annotations using hypothes.is. One should be an annotation that relates to today's inquiry question. The other should be a link to an article that relates to a passage in the reading.
Required: Finish the reading and annotations if you did not complete that in class.
Optional: Listen to this podcast. Focus on this question as you listen: How does poverty shape individual economic choices?
Abhijit Banerjee of MIT talks with EconTalk host Russ Roberts about Banerjee's book (co-authored with Esther Duflo), Poor Economics. The conversation begins with how randomized control trials (a particular kind of social experiment) have been used to measure the effectiveness of various types of aid to the poor. Banerjee goes on to discuss hunger, health, and education--the challenges in each area and what we have learned about what works and what does not. The conversation closes with a discussion of the role of the labor market in the private sector.