Lc o in the absence of trade, we expect relative prices to equal relative costs and thus. The problem is that trade issues are very complex and invariably certain people benefit at the expense of others. Handout 6, before class, for a pdf handout with 6 slides per page handout 3, before class, for pdf handout with 3 slides per page, with lines for taking notes pptx, before class, for the powerpoint file after. Scarcity and choice 25 3 demand, supply, and market equilibrium 47 4 demand and supply applications 79 part ii concepts and problems in macroeconomics 97 5 introduction to macroeconomics 97 6 measuring national output and national income 111 7 unemployment. Consequences of increasing returns theory and evidence. For more details on it including licensing, click here. Following the initiation of the general agreement on tari.
Lecture notes international trade and international finance. In the end, country a would have 30 shirts and 40 pairs of shoes much better than in the pre trade. The study of international commercial law 8 should trade shirts for shoes until each country has reached its optimal level of consumption. Examples include addiction to cigarettes, cyclical dieting, and. What explains the pattern of trade across countries. This is the table of contents for the book policy and theory of international trade v. For example a 20 percent tariff would indicate that if the import was priced at one dollar, with a. International economics, upng semester 1 2015 3 compiled by michael cornish wages. Introduction to theories of international trade simplynotes. The concept of theorethical international trade and main. The gravity equation under free trade introduction gravity.
International finance theory and policy is built on steve suranovics belief that to understand the international economy, students need to learn how economic models are applied to real world problems. Brief contents part i introduction to economics 1 1 the scope and method of economics 1 2 the economic problem. What explains the changes in trade patterns over time. Evidence from japan bernhofen and brown 2005 main idea this paper provides an empirical assessment of the comparative advantage gains. Policy and theory of international trade 2012 book archive. International economics revision notes michael cornish.
It then proceeds to analyze the history of trade policies and the evolution of the global trading system, with a primary focus on important policies or controversial. Axioms of consumer preference and the theory of choice. These pages contain my lecture notes for a phd course in international trade i taught at boston college between 20012003. May 31, 2019 international trade theory and policy analysis is an online textbook by steven m. The course develops arguments that support a free trade policy as well as arguments that support various types of protectionist policies. As pointed out in the introductionbalance of payments bop is a systematic. Lecture notes, lectures 111 econ1269 international trade. These require a lot of paperwork and almost nothing is done verbally, while in domestic business, at times, one could do with certain verbal communications. Special need for finance in international trade inco. This is the book policy and theory of international trade v. International trade theories notes definition and types. Pdf, after class, for pdf version of the slides that were used in class. Thats because economic models provide insights about the world that are simply not obtainable solely by discussion of the issues.
Macroeconomic theory and policy brockadams the structure of american industry bruce public finance and the american economy carltonperloff modern industrial organization casefairoster principles of economics cavesfrankeljones world trade and payments. Mar 21, 2016 introduction to theories of international trade some important theories of international trade 1. Pdf international trade theories, supplementary lecture notes, excerpt copy 2nd edition of teaching guide find, read and cite all the. In the end, country a would have 30 shirts and 40 pairs of shoes much better than in the pre trade world.
Trade policy tariffs and other barriers to trade lindert and pugel, chapters 7, 8, and 9. The objective of an international trade course is to understand the effects of international trade on individuals and businesses and the effects of changes in trade policies and other economic conditions. Introduction to policy analysis and policy modelling. This section provides the lecture notes from the course, supplemental figures, and the schedule of lecture topics. Find materials for this course in the pages linked along the left. Introduction to policy analysis and policy modelling the nature of public problems in the public sector problems. Pdf international trade theories, supplementary lecture notes. International trade procedures and documentation notes comparatively more complex than domestic business transactions. Chapter trade policy 31 are dominant in political lobbying. Macroeconomics 1880 1900 1920 1940 1960 1980 2000 matthiasdoepke universityofchicago andreaslehnert boardofgovernorsofthe federalreservesystem andreww. Lecture notes in international trade policy itr402 cevat gerni beykent universityistanbul 2010 these lecture notes mostly depend on the textbooks of dominick salvatore international economics, 9e, paul r. At its core is a sense of nationalism, in that nations want to avoid being harmed by other nations. Peter neary professor of economics, department of economics.
Introduction what is international economics about international economics uses the same fundamental methods of analysis as other branches of economics, because the motives and behavior of individuals and firms are the same in international trade as they are in domestic transactions. This version of neoclassical trade theory has continued to have a special appeal to economists championing the cause of free trade on the grounds of optimization at a global level, of productive efficiency, consumption and as such welfare, and the automatic utilization of factors of. Feb 18, 2015 international trade theories has long held that some trade is better than no trade, and more trade is better than less trade, and free trade is better than restricted trade free trade is a situation where a government does not influence international trade through quotas and tariffs. This section provides the schedule of lecture topics for the course and a complete set of lecture notes. In neoclassical trade theory, firms are treated as a black box. Accumulate gold and silver by exporting goods trade viewed as zero sum game lead to protectionism tariffs, quotes and subsides. Policy and theory of international trade table of contents. Of course, high tariffs may induce smuggling of goods through. Asset pricing theory apt static statistical model merits of factor pricing exact factor pricing and factor pricing errors. Basis of international or foreign trade foreign trade is based on the theory. It then proceeds to analyze the history of trade policies and the evolution of the global trading system, with a primary focus on important policies or. The instruments of trade policy goalsaims to equip students with an adequate set of tools. Comparative advantage and the gains from trade search.
International trade theory and policy is a masterful exposition of the core ideas of international trade. Elements of advanced international trade1 treb allen2 and costas arkolakis3 february 2016 new version. With respect to behavior, he examines why people choose to do things that many observers view as irrational. While it is primarily addressed to graduatelevel courses, it can also be easily adapted to upperlevel undergraduate use, since. Jaume ventura fall term 6 ects mandatory course inte rnational trade and finance 3 competences to be able to communicate with determination and in the english language, the results and implications of the required analytical study using a language that the receiver can relate to. Lecture notes microeconomic theory and public policy.
Overview and objectives background readings course structure. Another instrument of trade policy is an import quota. Links from this page go to the table of contents, a course syllabus, problem sets and an information for instructors page in which suranovic argues for the use of this site as a course textbook. If you found it useful or if you have any comments you would like to share, send me an email. In theory, problems can be approached using a rational, comprehensive problem solving model. Pdf international trade theories, supplementary lecture. It is true what they say, that economists do it with models. You will get far more out of the lectures if you work through the background reading ahead of. Background readings will not be covered in lectures explicitly, but students are expected to read them on their own during the course. Online text and notes in international economics the. The rybcznski theory lecture notes chapter 7 the international economy 3 rd edition kenen p. Oct 08, 2008 lecture notes on international trade theory and policy pomfret, richard on. Econ835 lecture notes international trade, finance and development 1 international trade. He has been teaching international trade and finance for more than twenty five years at gw and as an adjunct for cornell universitys washington, d.
Previously published as international trade theory and policy. Winners and losers from international trade lindert and pugel, chapters 4 and 5. The field of international trade introduction facts theory gravity 2 25 the. The notion of free trade has been a controversial topic for centuries. I discuss some general propositions of international trade theory concerning. What types of instruments are available to use to protect domestic industry. The new edition has been thoroughly revised and updated to reflect the latest research on international trade. Na description this lecture note provides an introduction to the field of international business with a primary focus on issues with global business, environments and strategies. The ricardian model theory, part i lecture 2 notes pdf 3. The problem is that trade issues are very complex and invariably certain people benefit at the expense of othe. The redistributive effects of trade reform can be a major factor impeding the launch of welfareimproving policy changes rodrik 1998.
Lecture notes on international trade theory and policy. With trade, a country can consume at a point outside of its ppf. This textbook by two eminent theorists of international trade presents the most integrated and ambitious treatment of the subject available to date. This version of neoclassical trade theory has continued to have a special appeal to economists championing the cause of free trade on the grounds of optimization at a global level, of productive efficiency, consumption and as such welfare, and the automatic utilization of factors of production at full capacity.
Differences in percapita income as a determinant of trade 4. Lecture notes in international trade by istvan t konya ssrn. International trade theory and policy is a masterful exposition of the core ideas of. In the second section we return to the general equilibrium concerns of traditional trade theory. Absolute cost advantage theory the principle of absolute advantage refers to the ability of a party an individual, or firm, or country to produce a greater quantity of a good, product, or service than competitors, using the same amount of resources. Barriers to trade are typically put in place to protect domestic producers from international compe. Deardorffs econ 340 lecture slides university of michigan. This paper provides a survey of the literature on trade theory, from the classical example of. It has evolved over several years of lectures to graduate students at major campuses such as mit, yale, and columbia. This text was adapted by the saylor foundation under a.
Steve suranovic is an associate professor of economics and international affairs at the george washington university gw in washington, d. For example, country a could trade 20 shirts for 40 pairs of shoes. Barriers to international trade indian exim policy. Lecture notes international economics i economics mit. Multinational firms, offshoring, outsourcing, and environment james r. Economics 2535 lecture notes advanced topics in international.
In the absence of trade a country must consume the goods and services it. Pdf international trade theories, supplementary lecture notes, excerpt copy 2nd edition of teaching guide find, read and cite all the research you need on researchgate. We will focus on international trade theory as a debate between those who advocate. With more than 2,200 courses available, ocw is delivering on the promise of open sharing of knowledge. The linder hypothesis, product cycles, and extensions 5. Increasing returns iii dumping and external economies of scale. International business lecture notes download book. If you continue browsing the site, you agree to the use of cookies on this website. Theory of international trade why do nations trade. To simplify the theory of international trade into practical easy to follow steps. We shall place a premium on explaining events, not simply. International trade theory and policy analysis is an online textbook by steven m. Preferential trade agreements lindert and pugel, chapters 10 and 11. Fin300 lecture notes week 1 international trade theories.
Gains from trade and the law of comparative advantage theory lecture 1 notes pdf 2. International business lecture notes by school of international business, southwestern university file type. Trade facts and the gravity equation stefania garetto. The assignment model approach theory lecture 4 notes pdf 5. Researchers were motivated by the large and growing volume of international trade in similar products intraindustry trade between similar countries, a phenomenon not adequately explained by traditional theory based on perfect competition. Classic examples include the process surrounding the creation and subsequent reforms to the european unions common. Mit opencourseware makes the materials used in the teaching of almost all of mits subjects available on the web, free of charge.
Markusen university of colorado, boulder university college dublin eth zurich may 2528 each lecture will be approximately two hours. What is optimal trade policy in this model to answer this question suppose that t is. Modern trade models lecture 8 differences in demand trade due to differences in consumer preferences, i. This development was driven by a number of factors. Gains from trade and the law of comparative advantage empirics. Different tastes between countries as a determinant of demand 3. Slantchev department of political science, university of california san diego april 19, 2005 overview. The book updates the classic monograph of professor gandolfo and is now the single most. System upgrade on feb 12th during this period, ecommerce and registration of new users may not be available for up to 12 hours.
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