Economic Development

Citation

Todaro, M. P., & Smith, S. C. (2020). Economic Development (13th ed.). Pearson.

Chapter Summary

The thirteenth edition has fifteen chapters and about 930 pages. Pearson describes it as a complete and balanced introduction to the requisite theory, the driving policy issues and recent research, taking a policy-oriented approach in which economic theory is presented in the context of policy debates and country-specific case studies. Several chapter titles carry subtitles such as "Theory and Policy", "Cases and Policies" and "Controversies and Opportunities", which signal that approach. The contents list is not divided into parts.

Chapters 1–2: Introducing Economic Development: A Global Perspective; Comparative Economic Development

The opening chapters set out what economic development is and look at developing countries from a global perspective, then compare their economies with one another and with richer countries.

Chapters 3–4: Classic Theories of Economic Growth and Development; Contemporary Models of Development and Underdevelopment

Two chapters of theory: first the classic theories of growth and development, then more recent models of development and underdevelopment. Theory therefore comes early, before the topical chapters.

Chapters 5–6: Poverty, Inequality, and Development; Population Growth and Economic Development: Causes, Consequences, and Controversies

Chapter 5 takes up poverty and inequality in relation to development. Chapter 6 treats population growth, with the subtitle indicating that it covers causes and consequences as well as the debates surrounding them.

Chapters 7–10: Urbanisation and Rural-Urban Migration: Theory and Policy; Human Capital: Education and Health in Economic Development; Agricultural Transformation and Rural Development; The Environment and Development

A block of chapters on sectors and resources: cities and migration, education and health as human capital, the transformation of agriculture and the rural economy, and the relationship between development and the environment.

Chapters 11–15: Development Policymaking and the Roles of Market, State, and Civil Society; International Trade Theory and Development Strategy; Balance of Payments, Debt, Financial Crises, and Sustainable Recovery: Cases and Policies; Foreign Finance, Investment, Aid, and Conflict: Controversies and Opportunities; Finance and Fiscal Policy for Development

The last five chapters turn to policy and the international economy. Chapter 11 considers who should do what in development: markets, the state and civil society. The following chapters cover trade theory and development strategy, the balance of payments, debt and financial crises, foreign finance and aid, and finally public finance and fiscal policy for development.

Key Concepts

Foundations and Theory (Chapters 1–4)

• Comparative development: setting the experience of developing countries against one another and against richer economies.
• Classic theories of growth and development: the earlier analytical frameworks for explaining growth and development.
• Models of underdevelopment: more recent models of how development and underdevelopment arise.

Welfare and Sectors (Chapters 5–10)

• Poverty and inequality: how the distribution of income and the extent of deprivation relate to development.
• Population growth: causes, consequences and controversies.
• Rural-urban migration: the movement of people between the countryside and cities, treated in theory and policy.
• Human capital: education and health as investments that support development.
• Agricultural transformation: change in farming and the rural economy as development proceeds.
• Environment and development: the links between economic development and environmental constraints.

Policy and the International Economy (Chapters 11–15)

• Market, state and civil society: the division of roles in development policymaking.
• Trade theory and development strategy: how openness to trade relates to national development strategy.
• Balance of payments, debt and financial crises: external constraints and the policies for sustainable recovery.
• Foreign finance, investment, aid and conflict: the opportunities and controversies of external resources.
• Fiscal policy for development: taxation, public spending and finance as instruments of development.

Critical Analysis

Strengths

• A broad, balanced scope. Fifteen chapters cover growth theory, poverty, population, cities, education and health, agriculture, the environment, trade, debt, aid and fiscal policy, which Pearson presents as a complete and balanced introduction and which suits a single main text for a general development course.
• A policy orientation that shows in the structure. Pearson says theory is set within policy debates and country-specific cases, and the chapter titles repeatedly name policy, cases and controversies, so the reader is steered towards how theory meets practice.
• Regularly revised. This is the thirteenth edition, which indicates long use as a teaching text, and Pearson sells it in print and as an eTextbook.

Limitations

• Breadth over depth. A survey of this width gives each topic limited room, and readers who want formal models of coordination, inequality or rural markets will need a more specialised text.
• Length. At about 930 pages and without division into parts, the book offers more than one course covers, and the contents list gives no suggested path, so instructors and readers must select chapters.

Where It Fits in the Course

Todaro and Smith is the broad, policy-oriented undergraduate text in the development economics list. Ian Goldin's Development: A Very Short Introduction is a brief first look that asks what development means and how it happens, and is useful before the larger book. Banerjee and Duflo's Poor Economics is a general-audience account of how poor households make decisions, based on randomised field experiments, and is a good companion for Chapters 5, 6 and 8.

Debraj Ray's Development Economics is the theory-oriented alternative: it builds simple formal models around history and expectations, coordination failures, incomplete markets and the interplay of inequality and growth, and treats those themes as the organising principle of the book rather than as part of a broader survey. For graduate study, Bardhan and Udry's Development Microeconomics is a concise text on the microeconomic theory of poor economies, and De Janvry and Sadoulet's Development Economics: Theory and Practice is a graduate-level text connecting theory, evidence and the design of policy.

How to Use This Book

Pearson's overview does not list prerequisites; an introductory economics course is a sensible starting point, and the policy-oriented, case-based presentation suggests the book is meant to be read by students without advanced technical training. It suits undergraduates in economics, international relations, public policy and related subjects.

A practical plan:

• Core: Chapters 1 to 5 supply the framework, the main theories and the central concern with poverty and inequality.
• Choose by interest: Chapters 6 to 10 cover population, cities, human capital, agriculture and the environment; pick those that fit the course or project.
• Policy and the international economy: Chapters 11 to 15 for courses with a policy or international emphasis, particularly Chapter 11 on the roles of market, state and civil society.

Treat the country case studies as the place where theory is tested, and compare them across countries. Because empirical figures date, update key numbers from current data before drawing conclusions. If the book is paired with Ray or with Bardhan and Udry, use Todaro and Smith for the policy context and the more specialised book for the underlying models.