The focus of the course will be on how to go from rigorous micro theory to the appropriate empirical test, as illustrated by a selection of classic papers in the field, as well as several more recent papers that are worth looking at. A solid knowledge of micro theory at the level of Varian (1992) (or our own Micro I and Micro II), and microeconometrics at the level of Wooldridge (2002), will allow you to survive. This second half of the course will focus on: (i) informality and history as an identification strategy, (ii) poverty traps and foreign aid, (iii) moral hazard and sharecropping, (iv) learning.