Tutors:

Zara Shroff ,  <zara.shroff@adelaide.edu.au>
Sabiha Akhter, <sabiha_akhter2000@yahoo.com>

Tuesday & Thursday, 4-5pm

Rooms:
Tuesday, 4-5pm, Physics, 103, Kerr Grant Lecture Theatre
Thursday, 4-5pm, Engineering Nth, N158, Chapman Lecture Theatre

The purpose of this course is to provide students with a thorough grounding in the theory of international trade as well as international trade policy and to demonstrate the relevance of the theory in the analysis of (a) existing patterns of international trade and what determines them, (b) the conduct of trade policy and (c) the economic implications of international trade and trade policy both for individual economies such as Australia and the wider international community.

 On successful completion of this course students will be able to:

1	Understand, at the level of formal analysis, the major models of international trade and be able to distinguish between them in terms of their assumptions and economic implications
2	Understand the principle of comparative advantage and its formal expression and interpretation within different theoretical models
3	Be able to apply partial equilibrium and (where required) general equilibrium models in analysing the economic effects of (a) trade policy instruments such as tariffs, quotas, export subsidies, (b) retaliatory measures such as anti-dumping duties and countervailing duties and (c) the creation of regional trading arrangements such as free trade areas, customs unions and common markets
4	Be familiar with, and be able to critically analyse the main arguments for protection and conversely be able to critically evaluate the relevance and realism of arguments for free trade, taking into account the costs and benefits of trade policy measures on different sections of the community and the implications for the formulation of trade policy
5	Be familiar with the major recent developments in the world trading system, and be able to critically analyse key issues raised both by the current round of WTO negotiations and by the spread of regional trading arrangements
6	Develop communications skills through the presentation of your work, interactions during tutorial sessions, and appropriate use of the discussion

International Trade: Theory and Evidence by Markusen, Melvin, Kaempfer and Maskus, Mcgraw Hill, 1995

*** This textbook is available free of charge and may be downloaded from: http://spot.colorado.edu/~markusen/textbook.html ***

The set of concepts that we study are standard. They are in no way unique to a certain brand of economics nor are they unique to this textbook. These concepts make up the essence of international trade theory. And I believe that if you understand the theory, you can better assess the world around you. We are economists. We are concerned with what choices people make and why they make those choices. We therefore study theory and then relate the theory to reality. The closer the theory is to the observed world, the better is that theory. And if the theory is really good, we can use it to actually predict behaviour. The better we can predict behaviour, the better will ultimately be the consequent policy that we write and thereby live under.

The information that you need to know is widely available. I have included some optional references below. Please keep in mind that I ultimately don’t care how you learn this material so long as you do.

Caves, R.E., J.A. Frankel and R.W. Jones, World Trade and Payments: An Introduction, New York: Harper Collins 1996 (7th edition).

Ethier,W.J., Modern International Economics, New York: W.W. Norton, 1988 (2nd edition).

Kenen, P.B, The International Economy, Englewood Cliffs: Prentice Hall, 1989 (2nd edition).

Krugman, P.R. and M. Obsfeld , International Economics: Theory and Policy, New York: Harper Collins 1994 (3rd edition).

Pomfret, R. International Trade: An Introduction to Theory and Policy, Oxford: Basil Blackwell, 1991.

Sodersten, B. and G. Reed, International Economics, London: Macmillan, 1994 (3rd edition).

Robert C. Feenstra and Alan M. Taylor, International Trade, 2007 Worth Publishers.

MyUni - http://www.myuni.adelaide.edu.au 

Other online Resources:
WTO: http://www.wto.org 
UNCTAD: http://www.unctad.org 
OECD: http://www.oecd.org 
International Center for Trade and Sustainable
Development: http://www.ictsd.org 
The World Bank: http://www.worldbank.org 
Alan Deardorff’s Glossary of International Economics Terms:

The lectures will closely follow this text. The idea is that the lectures and the text should reinforce each other. You are strongly advised to keep up with the reading. You will find that the lectures are far easier to follow if you have already been exposed to the material via the text.

The tutorial will be primarily based on problem solving in preparation for your assessment.

Lectures: 2 Hours per week
Tutorials: 1 Hour per week
Home study expectation: 6 Hours per week

 

Part I	Introduction	Chapters
Wk 1	Technical Concepts - Markusen, et.al.,	1 - 4
Wk 2	Why do countries trade?	5 - 6
Part II	Theoretical Analysis of International Trade
Wk 3	The Classical Model: Differing Technologies	7
Wk 4 & 5	The Heckscher - Ohlin Model	8
Wk 5 & 6	The Specific Factors Model	9
	Mid Semester Examination
Wk 7	Government Policies as the Determinants of Trade	10
Wk 8	Imperfect Competition as the Determinant of Trade and the Gains from Trade	11
	Increasing Returns to Scale	12
Wk 9	Tastes, Per Capita Income, and Technological - Change as the Determinants of Trade	13
	Empirical Studies of Comparative Advantage - Models	14
Part III	Trade Policy
Wk 10	Tariffs	15
	Quotas and Other Non-tariff Barriers	16
Week 11	Imperfect Competition, Increasing Returns - Strategic Trade Policy	17
	Preferential Trade Areas	18
Week 12	The Political Economy of Trade Policy	19
	Administered Protection	20

 

Mid-semester Test	30%	29 April 2014 (in Class)
Group Assignment	10%	4 April 2014 (COB)
Tutorial	10%
Final Exam	50%

All marks received prior to the final examination are equated into your final grade only if they represent improvement over your final examination grade. For example, should you score 80/100 on the mid-term, 60/100 on your assignment, 100/100 for your tutorial and 70/100 on the final, your final grade would be credit at (0.30*80+0.10*60+0.10*100 +0.50*70=) 75/100. More will be explained about this throughout the semester. Since all marks received prior to the final examination are redeemable, you have nothing to lose and everything to gain by attending tutorials and doing your best on all of the assessments.

Should you miss either mid-semester examination for whatever reason, your final examination will be worth 30% more per missed mid-semester exam. You need not excuse yourself for your absence, as there will be no make-ups under any circumstances. This same policy applies to the assignment. Whatever you miss simply adds additional weight to the final.

NOTES ON ASSESSMENT
1. Legible hand-writing and the quality of English expression are considered to be integral parts of the assessment process. Marks cannot be awarded for handwriting that cannot be read.

2. Assessment marks prior to the final exam may be displayed on the course website through Myuni. Students are encouraged to check their marks and notify the lecturer-in-charge of any discrepancies.

EXAMINATIONS
It is each student's responsibility to read the examination timetable. Misreading the timetable is not accepted as grounds for granting a supplementary exam. University staff are not permitted to provide examination times to students over the telephone or in response to personal enquiries.

Students may NOT take into the examination a DICTIONARY (English or English-Foreign)
Students may take a CALCULATOR that is incapable of storing text.

Assignments are to be submitted via the Professions Undergraduate Hub on Ground Level of Nexus 10.

Assignments will generally be returned during tutorials/lectures the week following submission.

Students must not submit work for an assignment that has previously been submitted for this course or any other course without prior approval from the lecturer-in-charge.