The main purpose of this class is to study in detail a small set of global economic trends and the policy challenges that they entail. The discussion of every topic will be shaped by the most recent empirical and theoretical research. Every session will start with the illustration of the most recent available data. The analysis that follows will be guided by standard economic methodology, with particular emphasis on the role of individual incentives. The topics: Population Flows. The distribution of population across countries and age classes varies continuously as a result of changes in birth rates and mortality rates, as well as migration. Economic Inequality. Economic inequality measured by the within country variation in income and wealth has increased remarkably in most developed countries. Education. Excellence in human capital is key in developing and retaining comparative advantage in the production of the most advanced products and services. Social Insurance. In most advanced economies, governments have set up vast social programs, with the intent of insuring their citizens against important risks. Health Care. The costs of health care are rising at a much faster pace than inflation in pretty much all of the industrialized world. Housing. The recent global financial crisis has evidenced the crucial role played by the housing market in shaping aggregate outcomes. Congestion. "Too many" people wishing to use a finite resource a bridge, for example, or a tunnel results in rationing. The accelerating urbanization that characterizes most developing countries is responsible for the increasing number of resources that are congested. Depletion of Natural Resources. Over the last two hundred years, economic development has led to an unprecedented use of natural resources, a good part of which are not renewable.
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