02537 - International Economics

Academic Year 2016/2017

Learning outcomes

After completing the course, students are expected to: - have learned the causes and consequences of international trade together with the motive for and the effects of protectionist policies, - have acquired insights regarding the main theories that explain the monetary and financial aspects of an open economy, - have obtained the necessary theoretical tools to help them understand the complex problems raised by the economic ties between the countries and to analyze 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. International Monetary Theory

a) Exchange rate

- Nominal and real exchange rates
- Interest rates and capital movements

- Price level, output, and exchange rate

- Fixed exchange rate and foreign exchange intervention

b) Macroeconomic policy in the open economy

c) Balance of payments and financial crisis

Readings/Bibliography

P. Krugman, M. Obstfeld, M. Melitz , "Economia Internazionale" , 10th edition, vol. 1 and 2, Pearson, 2014.

Further optional readings:

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

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.

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

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

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

lectures, exercises/discussions, presentation

Links to further information

http://alirezanaghavi.altervista.org/teachings2014.html

Office hours

See the website of Alireza Jay Naghavi