V573 Quiz E-course Frontier of Development Policies (10 min) (3% of total class grade.

Include 15 main with some bonus questions. Tick the best choice)

Your name:_______________________________ 1) What are the characteristics of "inclusive growth"? A. When new employment opportunities are created B. Growth that targets those trapped in low-productivity activities C. Neither A or B D. Both A and B Answer: D. Both A and B are features of inclusive growth 2) Dutch disease refers to: A. income inequality B. volatile public revenue C. governance problems D. loss of competitiveness Answer: D. Resource curse refers to the counterintuitive finding that countries with plenty of natural resources tend to suffer lower economic growth than countries with fewer natural resources. The major lesson from the vast literature on the so-called resource curse is that reliance on natural resources, even with high resource prices, can bring with it problems that retard growth, including loss of competitiveness (the so-called Dutch Disease), volatile public revenues as resource prices tend to move about a lot, governance problems, and income inequality. [Page 21-22] 3) Which is not true of inclusive growth? A. It occurs across sectors of an economy B. It includes the majority of a country's labor force C. It targets both high and low productivity activities D. Economic distortions are an obstacle to economic growth. Answer: C. It targets low-productivity activities. / / See page 26 of transcript. 4) Why were undeveloped countries able to recover more quickly than developed countries from the 2008 economic crisis? A. The had unused markets they invested in B. They did not have as much capital to lose as an advanced country, so it was easier to recover C. Other countries were willing to invest in their economies and thus they were lifted out of the crisis D. None of the above Answer: A. Pages 3 and 4 state the reasoning behind the undeveloped countries recoveries. 5) The Structural approach to development emphasizes all of the following except: A. Exchange controls B. Privatization C. Quantitative restrictions 1

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D. Import substitution Answer: B. The Structural approach largely emphasized government involvement in the form of exchange controls, quantitative restrictions, and import substitution, but not privatization. Which of the following is NOT related to the Washington Consensus phase of of development thinking that held sway over the 1980's and 1990's? A. Import Substitution B. One-size fits all C. Stabilization D. Structural Adjustment Answer: A. Answers B, C and D are all related to the Washington Consensus phase of development thinking. However, import substitution (A) is related to the structural approach phase of development thinking that lasted from 1945-1980. (slides 5-8 in Module 2) Which of the following about innovation in developing countries is not true? A. Developing countries can dramatically improve their position by acquiring existing knowledge. B. Copying and reverse engineering are not the proper ways for developing countries to improve innovation, since they infringe intellectual-property law. C. Developing countries need to invest in research and development in order to get into global research networks. D. Entrepreneurship is one of the key elements in innovation in developing countries. Answer: B. Copying and reverse engineering the most important source of technological catch-up, especially in the case of rapidly growing economies. The rate of adoption of innovations does not depend on which one of the following: A. peer pressure to adopt B. profitability of innovation compared to existing practice C. the Krenshaw theorem D. knowledge about the innovation Answer: C. The other three are true but the Krenshaw theorem is fictitious. This is from the slides on the second module. Which of the following is not true about Washington Consensus? A. It emphasizes the role of market B. It ignores inherent structural differences among countries C. It promotes economic liberalization and privatization D. It emphasizes the role of government in social protection Answer: D. Washington Consensus seeks to minimize the role of government in economy. (pp.8-9) Which is not a type of innovation identified in module 2? A. Frontier B. Catch-up C. Diffusion D. Inclusive Answer: C. Diffusion is not one of the four types of innovation mentioned. See slide 33 of the model 2 transcript.

11) Partnerships between the government and the Private sector increase economic development in the sense that they: A. Improve government resources B. Increase inefficiency in the service delivery C. Create more jobs D. All of the above Answer: C. Partnerships between the government and the private sector yield economic growth on the ground that, there is efficiency in service delivery. Furthermore, more jobs are created, thus, increasing revenue for the country in general / P. 19 12) Collective action problems occur when (choose the best answer): A. individual incentives and motivations run counter to group benefits B. two parties pursue their own goals C. a group works together on a difficult issue D. the government provides economic direction to a group Answer: A. Collective action is destroyed when people who should have a better goal as a group, pursue their own interests to the detriment of everyone 13) Which of the following is NOT listed in Module 3 as one of the three steps of coalition building? A. Identify the actors B. Identify the resources C. Map the institutional context D. Durability and stability of coalitions Answer: B. The other three options are listed as those necessary to build a coalition. Identifying needed resources may be an important part of any actions the coalition takes, but the initial process of creating a coalition may not involve this step. 14) Efficient Public-Private Partnerships (PPP's) are: A. Performance based with private revenue based on outputs B. Performance based with private revenue based on inputs C. Simple, short-term contracts that are performance based D. Simple, short-term contracts with private revenue based on outputs Answer: A. B is incorrect because efficient PPP's should be based on outputs so as to push focus onto the end result to ensure the end user (the public) benefits. C and D are incorrect due to the nature of PPP's needing to be long-term contracts that are extensive to ensure infrastructure or services are satisfactory and contracts are abided by. A simple contract may allow the private firm to essentially take over the project, while a short-term one may not incentivize the private firm to complete the task effectively and/or may not maintain the project for the adequate amount of time. 15) Which statement is NOT TRUE for the advantages of the Public Private Partnership (PPP)? A. Fast delivery B. Better design C. Lower financing cost D. Answer A and B Answer: C. The advantage of the PPP lies in its fast delivery and better design, but it has higher financing cost (Module 3 slide 22). 3

16) Which of the following is not identified in the module as a factor affecting the adoption of innovation? A. Knowledge B. Pofitability C. Support D. Culture Answer: D. The other three factors - knowledge, profitability, and support - are identified among those that influence the adoption of innovations. 17) A government may support the adoption and diffusion of technology through which means? A. Investing in human capital B. Removing tariffs C. Conducting information and publicity campaigns D. All of the above Answer: D. A, B, and C are all features of how a government may adopt and diffuse technology