PRIFYSGOL ABERYSTWYTH UNIVERSITY
DEGREE EXAMINATIONS – May / June 2009
ARHOLIADAU GRADD – Mai / Mehefin 2009
SEMESTER 2
EC31720
DEVELOPMENT AND TRANSITION ECONOMICS
Time Allowed: THREE Hours
Answer any THREE Questions
All questions carry equal marks.
1. Discuss the importance of agriculture in developing countries. Explain with the
help of a diagram why subsistence farmers in developing countries are averse to
innovation.
2. Distinguish between absolute and relative poverty. Discuss the various methods
employed to measure the inequality in a country. What policy options can LDC
governments adopt to reduce inequality while maintaining or accelerating
economic growth rates?
3. Discuss the demographic transition theory. Explain how population growth can be
both a cause and an effect of underdevelopment.
4. In what ways does the neoclassical theory provide a useful framework for
analysing environmental issues? Discuss the free rider problem in the context of
environmental degradation.
5. Discuss the importance of foreign aid from the perspective of low-income
countries. Critically evaluate whether foreign aid supports the objective of
development in low-income countries.
6. Explain the following concepts (250 words maximum):
a) Informal sector
b) Total poverty gap
c) Special and differential treatment
OR
Discuss the following (250 words maximum):
a) Role of the World Bank in development
b) The Millennium Development Goals
c) Dualistic development thesis
7. What are the main challenges that transition economies in Central and Eastern
Europe need to overcome? Using examples from one or two non-EU member
transition countries discuss the overall progress being made. END OF PAPER
