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Top 10 Service Traders 2007
Source: International Trade Statistics 2008 and 2009 (WTO)
International Migration
U.S. (2004)
The United States is the largest recipient Intra-Europe migration is popular Immigration within & to Asia is popular
Service Trade (2007)
Much smaller amount commercial service exports: $3,290 bn commodity exports: $13,950 bn Faster growth commercial service exports: 18% commodity exports: 15%
Macro-economic Policies in Open Economy
Fiscal policy Monetary policy
Macro-economic Policies in Open Economy
e.g.
1)
During this recession, Chinese governments launched ______ ______ policy. Besides, … If China were under the fixed exchange rate regime, could BOC ease the monetary policy during the recession? If it does, would it be useful to promote the domestic economy?
1) 2) 3) 4)
Grading
50:50 --50:50 --trade : finance regular : final
Regular grade in trade part (25 pts): team project
7-8 members In-class presentation (10-12 minutes, week 11&12)
Data and Facts in International Economics
International Trade and the World Economy
Source: International Trade Statistics 2009 (WTO)
Trade during the Recession
Tools
Analyzing methods in trade models Partial equilibrium model (S & D) --- considers only one market: quantity and price General equilibrium model (PPF & CIC) --- considers multiple markets: quantity, price and utility/welfare
English… Theories and evidence.. Logic thinking
Logic Thinking
Brain on a Hannibal island… Should I invest in real estate, stocks, bonds, gold, or something else? RMB exchange rate against USD?
Source: International Trade Statistics 2008 (WTO)
Top 10 Merchandise Traders 2008
Source: International Trade Statistics 2009 (WTO)
M Trade-GDP Ratio in 2007
2)
Back to the Beginning
Economics helps us understand the world Logical and analytical thinking important It depends… balance both sides… might lead to better judgment
Team Project
Analyze a specific question or phenomenon or news or statistics in international trade Narrow your topic! Others’ opinions v.s. yours 1) Be reasonable and logical 2) Use common sense, theories, case studies, data, or other evidence to support your argument
International Economics
International Finance Monetary issues --- nominal terms Capital (for higher returns w/o engaging in real production) More macro-economics!
Source: International Trade Statistics 2009 (WTO)
Trade by Commodity Group (2008)
Source: International Trade Statistics 2009 (WTO)
Trade by Product Category after 2008
Instructors
He, Yin (Week 2-6) Traditional international trade theories YAO, Shunli (week 7-10) New trade theories Foreign Outsourcing of Goods and Services International trade policies International Agreements WU, Ying --- international finance (week 13-18)
Economics --- like other science
Observe Explain each explanation/model – one aspect different assumptions – different results Predict?
How Useful is the Course?
Different Opinions
In Economics
It depends… Different people have different opinions, different theories might have different predictions due to different assumptions Better training and more comprehensive analysis might bring you better judgment
What do we study?
Why --- reasons How --- patterns Results --- impacts Other issues --- policies, organizations…
Textbooks
1) International Trade (or International Economics) by Robert C. Feenstra and Alan A. Taylor 2) International Economics: Theory and Policy by Paul R. Krugman and Maurice Obstfeld yhe.uibe@
Balance of Payment
Current Account Capital Account
Source: International Trade Statistics 2008 and 2009 (WTO)
Exchange Rates, FX Market, and Exchange Rate Regimes
Foreign Direct Investment
Merger and Acquisition
Other Trade Issues
Import tariff Infant industry protection Production subsidy Antidumping duty Free Trade Agreement and WTO
Total Men Women Dominican Republic Mexico China India Philippines Viet Nam
1,020,451 465,933 554,390 27,212 177,673 61,944 83,984 62,160 31,759
Source: International Labor Organization
Q*
quantity
General Equilibrium
1.
Production Possibility Frontier (PPF)
--- combination of quantities of different goods when resources are completely used --- SUPPLY (technology and endowments)