Transcript International Trade

International Trade
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• Text book
International Economics:Theory and Policy(7ed)
Paul R. Krugman
Maurice Obstfeld
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Chapter 1
Introduction
About This Course…
• Principle of Economics
• Theoretical Economics vs. Applied Economics
• About Mathematics
• Our stress: concepts & applications
• Lecture: week 6-19; Test: week 20
• Attendance
• Assignments & Class Discussions
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BRIEF CONTENTS
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PREFACE
1 Introduction
PART I INTERNATIONAL TRADE THEORY
2 World Trade: An Overview
3 Labor Productivity and Comparative Advantage: The
Ricardian Model
4 Resources, Comparative Advantage and Income Distribution
5 The Standard Trade Model
6 Economies of Scale, Imperfect Competition, and
International Trade
7 International Factor Movements
5
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BRIEF CONTENTS
• PART II INTERNATIONAL TRADE POLICY
8 The Instruments of Trade Policy
9 The Political Economy of Trade Policy
10 Trade Policy in Developing Countries
11 Controversies in Trade Policy
6
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Why are we caring about International trade?
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Fig 1-1
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Trade Openness
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Billion
Billion
Dollars
dollars
Exports and Imports of China
Export
exports,imports
1500
Export
Import
1000
500
0
1
3
5
7
9
11
13
15
17
19
21
23
Import
25 27 29
31
year(1978-2008)
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Introduction
• What is International Economics About?
• International Economics: Trade and Money
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What is International Economics About?
• International trade deals with economic interactions
that occur between sovereign nations.
(eg. Trade between U.S. & Mexico; Shanghai & Beijing?)
• The role of governments in regulating international trade and
investment is substantial.
• Analytically, international markets allow governments to
discriminate against a subgroup of companies.
• Governments also control the supply of currency.
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1.What Is International Economics About?
Micro-part
The Gains
from Trade
The Pattern
of Trade
1
Protectionism
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What is International Economics About?
• The Gains from Trade
• Can & cannot produce by itself.
• Why import when a good could be produced domestically?
• When countries sell goods and services to one another, all countries
benefit.
(ch3, productivity & wage; ch4, production factor abundance; ch6,
economies of scale Specialization & effieicncy _tangible goods
ch7, factor movements: international migration & borrowing and
lending._intangible goods)
• Trade and income distribution
• International trade might hurt some groups within nations. (eg.
specific resources owners; labor and capital owners)
• Trade, technology, and wages of high and low-skilled workers.
(disputs) (ch4,ch5)
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What is International Economics About?
The Pattern of Trade (Who trade with whom or sells what to whom?)
• Climate and resources determine the trade pattern of several goods.
• In manufacturing and services the pattern of trade is more subtle.
(eg. Japan for autos vs. U.S. for aircraft? )
-International difference in labor productivity.(ch3, Ricardo,19C)
-The relative supply & use of national resources such as capital, labor,
and land.(ch4,20C, powerful but controversial)
-A substantial random component.(ch6, economy of scale, market
structure, policy etc.)
• There are two types of trade
• Interindustry trade depends on differences across countries.
• Intraindustry trade depends on market size and occurs among
similar countries.
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What is International Economics About?
• Protectionism? (How much to trade?)
• Globalization: for or against? (NAFTA vs. EU? WTO negotiation, ASIA…)
(Seattle)
• Cost-benefit analysis? Many governments are trying to shield certain
industries from international competition. (eg. Export subsidizing or
import quota)
• Government interventions: politics.
(ch4 income distribution effects; ch9-11 power within countries matters)
• This has created the debate dealing with the costs and benefits of
protection relative to free trade.
• Advanced countries’ policies engage in industrial targeting.
• Developing countries’ policies promote industrialization:
• Import substitution versus export promotion industrialization.
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What is International Economics About?
• The Balance of Payments
• Some countries run large trade surpluses.
• For example, in 1998 both China and South Korea ran trade
surpluses of about $40 billion each.
• Global Imbalance
• Is it good to run a trade surplus and bad to run a trade
deficit?
• Exchange Rate Determination
• The role of changing (floating) exchange rates is at the
center of international economics.
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What is International Economics About?
• International Policy Coordination
• A fundamental problem in international economics is how
to produce an acceptable degree of harmony among the
international trade and monetary policies of different
countries without a world government that tells countries
what to do.
• The International Capital Market
• There are risks associated with international capital
markets:
• Currency depreciation （even contagious）
• National default
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Macro-part
The Balance
of Payments
International Policy
Coordination
The International
Capital Market
Exchange Rate
Determination
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返回
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2.International Economics: Trade
and Money
International
Economics
Our Focus
International
Trade (real
transactions)
International
Money (financial
transactions)
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International Economics:
Trade and Money
 International trade analysis focuses primarily on the
real transactions in the international economy.
• These transactions involve a physical movement of
goods or a tangible commitment of economic
resources.
– Example: The conflict between the United States and
Europe over Europe’s subsidized exports of agricultural
products.
– Antidumping case. Customs duties. Cow diseases…
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International Economics:
Trade and Money
• International monetary analysis focuses on the
monetary side of the international economy.
• That is, financial transactions such as foreign purchases of
U.S. dollars.
• Example: The dispute over whether the foreign exchange value of
the dollar should be allowed to float freely or be stabilized by
government action.
• Should RMB appreciate ? Is it undervalued? If yes, how much is it
undervalued?
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International Economics:
Trade and Money
• International trade issues
• Part I: International Trade Theory
• Part II: International Trade Policy
• International monetary issues
• Part III: Exchange Rates and Open-Economy Macroeconomics
• Part IV: International Macroeconomic Policy
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