DEVELOPMENT ECONOMICS

FINAL EXAMINATION
Duration: 120 minutes.

PART I: Answer TWO questions in 70 minutes

1. For all of the diversity, developing countries are linked by a range of common problems.
What are these problems? Which problem do you think are the most important? Why?
2. Briefly describe the various definitions of the meaning of development you have
encountered. What are the strengths and weaknesses of each approach? Why is an
understanding of the meaning of development crucial to policy formulation in the Third
World nations?
3. What in your view are the major determinant of economic growth and the main
characteristic of a growing economy? Determine the relationship between investment,
saving and growth in the Harrod Domar model.
4. The argument that export-oriented industrialization is superior to import-substituting
industrialization both in achieving faster industrial growth and in absorbing more labor.
Discuss with reference any one developing country.
5. How important is foreign aid for the economies of the Third World in relation to their others
sources of foreign exchange receipts? Under what conditions and terms do you think LDCs
should seek and accept foreign aid in the future? If aid cannot be obtained on such terms, do
you think LDCs should accept whatever they can get? Explain your answer?

PART II: Answer TWO questions in 50 minutes

1. Explain briefly two main reasons by which Asian financial and currency crisis happened in
1997.
2. Discuss briefly Tsunami tidal waves in Indonesia from Dec 26, 2004 in a framework of EV-
IB model based on the following text. Which appropriate measures can be implemented by
the government to recover the country?
“At least 100,000 people were killed by Tsunami tidal waves in Indonesia, including foreign
tourists at famous seaside resorts. Moreover, in the coast of Indonesia, with 100 fisherman
declared dead and seafood supply in Indonesia reduced sharply”
3. Based on the performance of Vietnam economy in recent years (2003-2004), explain briefly
that why Vietnam has still had a weak competitiveness level in comparison with the other
Asian countries?

This is a small gift of 5Long dedicating to you. Good luck to all of you!