International Economics Assignments Page, Fall 2019

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Week 11

November 4, 2019     Chapter 11: An Introduction to Open Economy Macroeconomics



• Chapter 11: An Introduction to Open Economy Macroeconomics
• The Macro-economy in a Global Setting
  • Aggregate Demand = C + I + G + NX
  • Aggregate Supply: SRAS and LRAS
    1. Shifters on LRAS: Changes in Natural Resources, Labor, Capital, and Technology (Entrepreneurship)
    2. Shifters on SRAS: Price and wage expectations and business costs
    3. How does a Boom in Canada affect the U.S. economy? Price level, Real GDP, and Unemployment
  • The Multiplier Effect
• Gerber's Chapter 11 PowerPoint Slides





November 6, 2019    Review and Continue Chapter 11: An Introduction to Open Economy Macroeconomics



• REVIEW



• Finish Chapter 11: An Introduction to Open Economy Macroeconomics
• Fiscal and Monetary Policies
  • Fiscal Policy
  • Monetary Policy
    • Open Market Operations
    • Expansionary Monetary Policy
    • Contractionary Monetary Policy
• Current Account Balances Revisited
  • Fiscal and Monetary Policy and the Current Account
  • Expenditure Switching
  • Expenditure reducing Policies
  • The Adjustment Process: The J-Curve
• Gerber's Chapter 11 PowerPoint Slides




Week 12

November 11, 2019     Veterans Day Holiday








November 13, 2019    Exam III - Chapters 9 - 11

     PAST ASSIGNMENTS:

Week 10

October 28, 2019     Chapter 10: Exchange Rates and Exchange Rate Systems



• Chapter 10: Exchange Rates and Exchange Rate Systems
• Introduction: Fixed, Flexible, or In-between
• Exchange Rates and Currency Trading
  • Reasons for holding currency
  • Interest Rate Arbitrage
  • Exchange Rate Risk
• The Supply and Demand for Foreign Exchange
• Supply and Demand with Flexible Exchange Rates
  • Appreciation: increase in the price of own currency
  • Depreciation: decrease in the price of own currency
• PPP
• Gerber's Chapter 10 PowerPoint Slides





October 30, 2019    Chapter 10: Exchange Rates and Exchange Rate Systems



• Chapter 10: Exchange Rates and Exchange Rate Systems
• Exchange Rates in the Long Run
  • PPP
  • Exchange Rates in the medium and short run
  • The Interest Parity condition
  • Largest Market in the World
    • The Real Exchange Rate vs. the Nominal Exchange Rate
  • Alternatives to Flexible Exchange Rates
    • Fixed Exchange Rate Systems
    • Crawling Pegs
    • Choosing the Right Exchange Rate System
    • Single Currency Areas and Optimal Currency Areas
• Gerber's Chapter 10 PowerPoint Slides







Week 9

October 21, 2019     Review of International Trade



• Review the Exam
• Review of International Trade
  • Tariffs and Quotas Worksheet





October 23, 2019    Chapter 9: Trade and the Balance of Payments



• Chapter 9: Trade and the Balance of Payments
• The Current Account
  • Trade Balance
  • The Current Account
  • The Capital Account
  • The Financial Account
  • The Current Account and the Macroeconomy
    • The National Income and Product Accounts
  • International Debt
  • Gerber's Chapter 9 PowerPoint Slides
  
  






Week 8

October 14, 2019     Chapter 8 - Trade, Labor and Environmental Standards and REVIEW



• Chapter 8 - Trade, Labor and Environmental Standards Chapter 8 PPT
  • Income and Standards
    • Setting Standards
    • Labor Standards: Child Labor for example
  • Trade and the Environment
    • Deforestation
    • Endangered Species
  • Global Climate Change
  
  
• REVIEW





October 16, 2019    Exam II - Chapters 6 - 8







Week 7

October 7, 2019     Finish Chapter 6 and Chapter 7 - Commercial Policy and Arguments for Protection



• Read Chapter 6 - Tariffs
  • An Export Tariff
  • The Optimal Tariff - only in the large country: the DWL
  • Effective Rate of Protection (versus nominal rates of protection)
  • Quotas - What's an Embargo? A quota of "0"
  • VER: A voluntary export restraint
  • Non-tariff barriers
  
  
• Read Chapter 7 - Commercial Policy and Arguments for Protection Chapter 7 PPT
  • Why Nations Protect their industries
    • Costs of Protectionism
  • Commerical Policy and Arguments for Protection
    • Revenue
    • The Labor Argument
    • The Infant Industry Argument
    • The National Security Argument
    • The Cultural Protection Argument
    • The Retaliation Argument
  • The Politics of Protetion in the U.S.
    • Antidumping Duties (ADD)
    • Countervailing Duties (CVD)
    • Excape Clause Relief
    • Section 301 and Special 301
  
  



October 9, 2019    NO CLASS: In K.C. at the MVEA Conference presenting a paper






Week 6

September 30, 2019     Chapter 6 - Tariffs



• Read Chapter 6 - Tariffs Chapter 6 PPT
  • Gains from Free Trade
  • An Introduction to Tariffs
    • Producer and Consumer Surplus
    • Pick a country!



October 2, 2019    Chapter 6 - Tariffs continued



• Read Chapter 6 - Tariffs
  • Gains from Trade one more time, World Price
  • Welfare cost of Tariffs - Dead Weight Loss (DWL)
• World price revisited
  • Who Gains and Who loses within a country
  • An Export Tariff
  • The Optimal Tariff
  • Tariff Escalation
• Quotas - What's an Embargo?
• Quotas
  • Producer and Consumer Surplus - Gains and losses (the welfare effects of Quotas)
  • What are quota rents?
  • Equivalence or nonequivalence of tariffs and quotas




Week 5

September 23, 2019    Review Day



• Review all the material so far!
  
  




September 25, 2019    Exam 1, Chapters 1 - 4 Plus



• TEST 1




Week 4

September 16, 2019    Finish Chapter 4: The HO Model, Stolper-Samuelson, Rybzinski Theorem, etc.



• Comparative Advantage
  
  
• Review of Theories so far - Attendance Quiz
• Major Points:
  • Adam Smith and Mercantislism - the world is positive sum = win-win
  • Models:
    • Ricardian Concepts: Productivity
    • HOS Model: Factor Endowments, that is relative amounts of resources prior to trade
  • "Add-ons"
    • Stolper-Samuelson
    • Factor Price Equalization
    • The Rybczynski Theorem
    
    



September 18, 2019     Chapter 5: Beyond Comparative Advantage



• Read Chapter 5 - The PowerPoint are here: Chapter 4 PPT
• Chapter 5: Beyond Comparative Advantage
  • Introduction: More reasons to trade
  • Intraindustry Trade
    • Characteristics: New Trade Theory
    • Oligopoly and Monopolistic Competition
    • The Gains from Intraindustry Trade
  • Trade and Geography
    • Geography, Transportation Costs, and Internal Economics of Scale
    • External Economics of Scale
    • Trade and External Economies
    • Industrial Policy
    • Market Failures
    
    
    

Week 3

September 9, 2019    Finish Chapter 3: Comparative Advantage and the Gains from Trade



• Comparative Advantage
  
  
• Read Chapter 3: Comparative Advantage and the Gains from Trade - Here's the PowerPoint Slides: Chapter 3 PPT
• Introduction: The Gains from Trade
  • Adam Smith and Mercantislism - the world is positive sum = win-win
  • A simple Model of Production and Trade
    • Absolute Productivity Advantage and the Gains from Trade
    • Note that the Cost is Opportunity Cost: production which could have been made instead
  • Comparative Productivity Advantage and the Gains from Trade
    • The Productions Possibilities Curve
    • Relative Prices
    • The Consumption Possibilities Curve
    • Autarky - "Pre-Trade"
    • The Gains from Trade
    • Domestic Prices and the Trade Price
    
    
• EIA numbers in a .pdf file - updated a week ago



September 11, 2019     Chapter 4: The HO Model



• Read Chapter 4 - The PowerPoint are here: Chapter 4 PPT
• Introduction: The Determinants of Comparative Advantage
  • Two Countries and Two Goods
  • Factor Abundance and Factor Scarcity
    • Relative adbundance of a factor implies that the relative cost is less than in scarcer countries
    • Relative Intensity and relative abundance
  • Increasing Costs: A Bowed outward PPC
    • Opportunity Cost and the slope of the Productions Possibilities Curve
    • The Consumption Possibilities Curve (CPC)
    • The Stolper-Samuelson Theorem
    • An increase in the price of a good raises the income earned by the factors used intensively in producing that good
    • The Magnification Effect




Week 2

September 2, 2019     HAPPY LABOR DAY HOLIDAY!!!

September 4, 2019     Chapter 2: International Economic Institutions Since World War II



• International Institutions
  
  
• Read Chapter 2: International Economic Institutions Since World War II - Here's the PowerPoint Slides: Chapter 2 PPT
• Introduction to Chapter 2: World Bank, International Monetary Fund (IMF), and the General Agreement on Tariffs and Trade
  • Bretton Woods, July 1944, New Hamphsire
    • In order to avoid the mistakes of the 1920s and 30s: Created the World Bank and IMF.
    • IMF: Quota based on economic size - helps when foreign exchange reserves are low or a crisis in international payments occurs (loans funds in times of crisis)
    • World Bank: Loans funds for infrastructure or development in non-industrial economies
    • GATT to the WTO: Principles of National Treatment and Most-Favored Nation (Nondiscrimination)
  • Regional Trade Agreements
    • Five Types of Regional Trade Agreements
      • EU, NAFTA, MERCOSUR, are examples
      • Arguments for and against
  • Public Goods
    • Nonexcludable and Nonrival
    • Free Riding
    • Lender of Last Resort
    
    
• Comparative Advantage
  
  
• Read Chapter 3: Comparative Advantage and the Gains from Trade - Here's the PowerPoint Slides: Chapter 3 PPT
• Introduction: The Gains from Trade
  • Adam Smith and Mercantislism - the world is positive sum = win-win
  • A simple Model of Production and Trade
    • Absolute Productivity Advantage and the Gains from Trade
    • Note that the Cost is Opportunity Cost: production which could have been made instead
  • Comparative Productivity Advantage and the Gains from Trade
    • The Productions Possibilities Curve
    • Relative Prices
    • The Consumption Possibilities Curve
    • Autarky - "Pre-Trade"
    • The Gains from Trade
    • Domestic Prices and the Trade Price
    
    
  • Quiz 3, Question #1 in Gerber

  Week 1

August 26, 2019     An Introduction to the Course



• The Syllabus
• The Outline
• The Course
• First Day's Introduction PowerPoint Slides

August 28, 2019     Chapter 1: An Introduction to the World Economy



• Read Chapter 1: An Introduction to the World Economy - Chapter 1 PPT
• Economic Integration
  • Trade to GDP ratio
  • Capital and Labor Mobility
  • Deeper Integration
  • Multilateral Organizations and Regional Trade Agreements
  • Trade and Economic Growth
• Twelve Themes in International Economics: Only the first two are relevant for now:
  • Gains from Trade (Chapters 3, 4, and 5)
  • Wages, Jobs, and Protection (Chapters 3, 6, 7, and 8)
• Overview of the Text and the Class