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ECON-UA 323: ECONOMIC DEVELOPMENT

Final Exam, Spring 2020

Please type your answers to the final exam (and remember to include your name in your response. This exam will go live on Classes at 12:30PM Eastern, please turn in your responses also to Classes at 1:45 (or longer if you have a different arrangement with the Moses Center).

You should feel free to use any material you want to help you with your answer (including liberal use of quoting or research online), but do not communicate with anyone about the exam during the exam.

Since you are typing your answers, we expect them to be at least spell checked. We are not going to be responding to questions during the exam – if you are unclear about something just use your best judgement.

Imagine that you are working in the Ministry of Labor. Your boss is worried about the misallocation of labor: people not working in the sector where they would be most productive. In particular, they are interested in Suanna Oh’s dissertation:

https://drive.google.com/file/d/1OPY49fjA5mVc68FE0Pccj-fboMhXzta-/view

Your boss is hoping for a brief summary of the paper.

First, provide an “elevator pitch” of the paper: if you were on an elevator for 5 minutes (roughly a page) with your boss and had to describe the paper, what would you say? For instance, what was the intervention she tried, and what were the main outcomes? There is no right answer to this: you should not try to pick the parts you think that I find the most interesting.

Then your boss has two additional questions

1) In the paper, she describes a few possible mechanisms for her results, and focuses on one. How does she do so, and do you find her argument credible?

2) As you know from introspection, sometimes you just run out of time to finish stuff. One thing that Suanna was hoping to finish before graduating (but ran out of time) was figuring out the aggregate implications of this behavior. That is to say, on aggregate, how bad is it that some people are unwilling to take some jobs (but other people are willing to take them)? What would you want to know for figuring out how much unwillingness to take certain kinds of jobs matters for aggregate GDP? This is a *hard* question, so do your best. Try to think how the misallocation intuition that we’ve talking about in class and in your problem sets might be useful, even if it was about different contexts.

3) Describe a different social setting where you think this type of story might also be at play (people unwilling to take jobs that they might be good at and might enjoy, to preserve their identity).

You should feel free to quote liberally from the paper, but you should be able to coherently tie things together – we don’t just want you to regurgitate the paper back to us

Good luck!