International Trade III/IIID
国际贸易homework代写 Stolper Samuelson theorem– an increase in the price of a commodity will increase the real return to the factor used intensively
Sum up the course 国际贸易homework代写
- To analyse trade among nations in a manner consistent with microeconomics
- Consider countries as simple economic agents that are rational, wealth maximizers
- Ultimate goal is to predict reactions of nations to differing trade environments ⟹ wealth maximizer policies
Basic models
Ricardian model
✓Single factor of production 国际贸易homework代写
✓Linear PPF’s
✓Complete specialization
➢Country production functions (technology) differ ⟹ gains from trade
Heckscher Ohlin model 国际贸易homework代写
✓Two factors of production⟹ factor substitutability
✓Non-linear PPF
✓Identical production functions (technology)
✓Identical preferences with imperfect substitutability between goods ⟹ indifference map
➢ Country endowments differ ⟹ grains from trade 国际贸易homework代写
- Stolper Samuelson theorem– an increase in the price of a commodity will increase the real return to the factor used intensively in the production of that commodity and a decrease in the real return of the other sector
- Rybczyncki Theorem– an increase in the supply of a factor will lead to an increase in output of the commodity that uses that factor intensively and a decrease in the output of the other factor
- Specific Factor Model– equal to the SR HO model ⟹ L is mobile between X & Y⟹K is specific to X & Y
- Major results
✓↑ specific factor ⟹ ↑ real return to labour & ↓ in real return to both specific factors
✓↑ Labour ⟹↓ real return to labour & ↑ in real return to both specific factors
✓↑ ?? ⟹ %∆? > %∆?? > %∆? > %∆?? > %∆s
Increasing return to scale model 国际贸易homework代写
- Decreasing AC ⟹ increased specialization
- Convex PPF
- External Economies ⟹ IRS at industry level
- Internal Economies ⟹ IRS at company level
- Monopolistic competition
➢Provide explanation for intra-industry trade
III. Applications 国际贸易homework代写
Government policies
✓Production tax on X or Y
✓Production subsidy on X or Y
✓Consumption tax on X or Y
✓Consumption subsidy on X or Y
✓Factor taxes
✓Theory of second best
Imperfect competition ⟹monopolies etc 国际贸易homework代写
✓SOE vs two country model
✓Cournot model
Tariffs
✓SOE vs two country model
✓Tariff vs taxes
✓GE diagram vs excess demand diagram
Non-tariff barriers
- Quotas ⟹ rent reallocation, VER etc 国际贸易homework代写
- Quota representation ⟹ GE vs Excess demand
- Quota vs Tariffs
➢Rent allocation
➢Two country vs SOE
➢Economic growth
Free Trade Areas 国际贸易homework代写
✓Ricardian setting
✓HO setting
✓SOE vs 2 country model
✓Welfare implications of FTAs
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