1. THE WORLD ECONOMY: GROWTH AND CRISIS
Economics 1490
THE WORLD ECONOMY: GROWTH AND CRISIS
with
Professor Dale W. Jorgenson
Lecture 01: September 1, 2016
INTRODUCTION
Harvard University Department of Economics – Fall 2016

2. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
THE WORLD ECONOMY: GROWTH AND CRISIS
Comparing Economies across the World and over Time.
2. The Great Debate over the Financial and Economic Crisis.
3. The European Slowdown and the Crisis in Europe.
4. Asian Economic Miracles: Will They Continue?
5. Sustainability of Economic Growth.
6. World Economic Outlook.

3. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
COMPARING ECONOMIES ACROSS THE WORLD AND OVER TIME
1. Course Outline.
2. The World Economy since 1990: Growth and Crisis.
3. Comparing Economies: Production and Welfare
4. The Sources of Growth: Asia, Europe, and the United States.
5. Growth and Competitiveness.

4. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
THE SOURCES OF ECONOMIC GROWTH
Comparisons among Regions and Countries
Sources of Growth in Capital Input
Information Technology and Non-Information Technology
Labor Input and Labor Quality
Total Factor Productivity

5. THE WORLD ECONOMY: GROWTH AND CRISIS Sources of World Economic Growth
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
Sources of World Economic Growth
Average annual growth rates, weighted by the income share.

6. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
The great debate over the Financial and Economic Crisis
6. The U.S. Financial Crisis.
7. Monetary Policy.
8. Financial Regulation: Micro-Prudential and Macro-Prudential.
9. Fiscal Policy.
10. Secular Stagnation.

7. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

8. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
TIMELINE OF THE FINANCIAL CRISIS IN 2008
March 14: Federal Reserve Provides Financial Backing to JPMorgan Chase's Purchase of Bear Stearns.
September 7: Federal Government Bails Out Fannie Mae and Freddie Mac.
September 12: Treasury Secretary Hank Paulson States That No Government Money Can Be Used in Any Rescue.
September 13: Barclay's Purchase of Lehman Vetoed by British Regulators.
September 15: Lehman Brothers Bankruptcy.
September 16: Fed Announces $85 Billion Bailout of AIG.
October 3: Congress Passes Troubled Asset Relief Program.
October 14: TARP Equity Program Announced by the Treasury.

9. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
HOUSE OF DEBT
Debt and Destruction
Cutting Back
Levered Losses: The Theory
Explaining Unemployment

10. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
DEBT AND DESTRUCTION
The Harshness of Debt
Debt and Wealth Inequality in the Great Recession
How the Poor Got Poorer
The Geography of Net Worth Destruction
Foreclosures and Fire Sales
Debt: The Anti-Insurance

11. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

12. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

13. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
THE EUROPEAN SLOWDOWN AND THE CRISIS IN EUROPE
11. U.S. Growth Resurgence and European Slowdown.
12. European Competitiveness.
13. Europe 2020 and the Single Market.
14. Economic Policy Response: The Euro.
15. European Policy Response: Brexit.

14. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

15. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

16. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

17. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
Asian Economic Miracles: Will they Continue?
16. Is Asia’s Miracle a Myth?
17. Japan: Growth and Crisis.
18. The Four Tigers: Hong Kong, Singapore, South Korea, and Taiwan.
19.China: Before and After the Crisis.
20. India: Dancing with Giants.

18. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
KRUGMAN: 1994, 2005, and 2010
Paul Krugman, “The Myth of Asian Miracles,” Foreign Affairs, November-December 1994: “From the perspective of the year 2010, current projections of Asian supremacy extrapolated from recent trends may well look as silly as l960s-vintage forecasts of Soviet industrial supremacy did in from the perspective of the Brezhnev years.”
Paul Krugman Blog, New York Times, October 31, 2005: “[I]n the mid-1990’s I made some modestly pessimistic predictions about Asia back when everyone else was wildly optimistic. When a terrible financial crisis struck, people said I had been proved right. My response was that I had been 90 percent wrong, it’s just that everyone else had been 150 percent wrong.”

19. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

20. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

21. THE WORLD ECONOMY: GROWTH AND CRISIS INDIA: OUTLOOK AND OPPORTUNITIES
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
INDIA: OUTLOOK AND OPPORTUNITIES
Macroeconomic Fundamentals Have Dramatically Improved
Shifts in Policies and Persistent Incrementalism Could Cumulate to “Big Bang” Reforms
Political Mandate for Reform Has Created a Historic Moment of Opportunity

22. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
Chapter 13, Figure 6:
Japan-U.S. TFP Gaps in Manufacturing and Non-Manufacturing,1955–2012

23. THE WORLD ECONOMY: GROWTH AND CRISIS Sustainability of Economic Growth
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
Sustainability of Economic Growth
21. Comparing Populations: Demographic Projections.
22. Human Capital: Education and Experience.
23. Fiscal Sustainability.
24. Environmental Sustainability.
25. Poverty and Development.

24. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

25. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
Reading List: Congressional Budget Office (2016), “Summary” and “The Long-Term Fiscal Imbalance,” The 2016 Long Term Budget Outlook, Washington, DC, Congressional Budget Office, June, pp

26. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

27. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS

28. THE WORLD ECONOMY: GROWTH AND CRISIS Outlook for the World Economy
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
Outlook for the World Economy
Hours Worked from Labor Force Projections;
Labor Quality from Projections of Educational Attainment
Productivity Growth from Production Possibility Frontier:
IT and Non-IT Productivity Growth, Capital Quality, and the
Gap between Growth of Output and Capital
GDP Growth Is the Sum of Growth in
Hours Worked and Productivity Growth

29. THE WORLD ECONOMY: GROWTH AND CRISIS Range of World Output Projections
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
Range of World Output Projections

30. THE WORLD ECONOMY: GROWTH AND CRISIS
Lecture 01: September 1, 2016
THE WORLD ECONOMY: GROWTH AND CRISIS
GROWTH AND CRISIS IN THE WORLD ECONOMY
Comparing Economies across the World and over Time
The Great Debate over the Financial and Economic Crisis
European Slowdown and the Crisis in Europe
Asian Economic Miracles: Will They Continue?
Sustainability of Economic Growth
Outlook for the World Economy