02537 - International Economics

Learning outcomes

The course is divided in four parts. The aim of the first two parts is to give students a better understanding of causes and consequences of international trade and of  the effects of trade policies respectively. The aim of the third part is to equip students with the main approaches to international factor movements, organization of firms, and debates on globalization. The final part deals with exchange rates and international capital market . Upon completing the course students will have a theoretical framework to understand the complex issues raised by the economic interdependence of nations and to analyse them in a systematic way.

Course contents

1.   Cause and Consequences of International Trade

         a)   The Comparative Advantage Theory              

               -The Ricardian Model
               -The Specific Factors Model
               -The factor proportions Model

         b)     Economies of Scale, Imperfect Competition and  International Trade

2.   Trade Policy 

           a)  The Instruments of Trade Policies
           b)  The Political Economy of Trade Policies

3.   International factor movements, globalization, and developing countries

           a)   Foreign direct investment and migration
           b)   Offshoring, outsourcing, and licensing
           c)   Trade policy in developing countries
           d)  Controversies about the WTO and globalization (intellectual property rights, labor standards, trade and environment)

4.   International Monetary Theory

           a)   Nominal and real exchange rates
           b)   Interest rates and the capital 

Readings/Bibliography

P. Krugman, M. Obstfeld, M. Melitz , "Economia Internazionale" , fifth edition, vol. 1 and 2, Pearson,  2012. 

R. Feenstra, A. Taylor, "Economia Internazionale", edited in Italian by Giorgio Basevi, Hoepli, Milano, 2009.

Further optional readings:

R. Freeman, "Are your Wages Set in Beijing?", Journal of Economic Perspectives 9(3), 15-32, 1995.

J..Markusen, J. Melvin, W. Kaempfer, K. Maskus , "International trade, Theory and Evidence", McGraw-Hill, 1995.

W. Martin, K. Maskus, "Core Labor Standards and Competitiveness: Implications for Global Trade Policy", Review of International Economics, 9(2), 317-328, 2001.

K. Maskus, "Intellectual Property Rights in the Global Economy", Institute for International Economics, 2000 (chapter 3).

G.B. Naveretti, A.J. Venables, et al., "Multinational Firms in the World Economy", Princeton University Press, 2006. 

H. Nordstrom, S. Vaughan, "Trade and Environment: Special Studies 4", World Trade Organization Report, Geneva, 1999 (chapter 3). available online: http://www.wto.org/english/tratop_e/envir_e/environment.pdf

P. Samuelson, "Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization", Journal of Economic Perspectives 18(3), 135-146, 2004. 

Also available at the library of the department of economics (strada maggiore 45):

P. Krugman, M. Obstfeld,  " Study Guide" (solutions to exercises in the book and additional exercises)

Teaching methods

During the 60 teaching hours, respective arguments will be confronted in the order indicated in the program. After the presentation of the underlying theory behind the topic under study, the political economy applications of each and relevant exercises will be carried out.

Assessment methods

The course will be concluded by a written examination.

Teaching tools

22 lectures (44 hours); 8 exercises/discussions (16 hours)

Links to further information

http://www2.dse.unibo.it/naghavi/teachings.html

Office hours

See the website of Alireza Jay Naghavi