U
NIVERSITAS MUHAMMADIYAH YOGYAKARTAFaculty of Economics IPIEF Program
Lecturer: Dyah Titis Kusuma Wardani , MIDEC.
E-mail: [email protected] Phone: +62 811 263 8191
COURSE DESCRIPTION:
EI8475 International Trade and Development, is an introductory course in international economics.
The course focuses on trade relations between countries. We examine why nations engage in international trade and evaluate the benefits and costs of such activity; the arguments for and against trade protection; and the impact of trade on developing economies.
SCHEDULE:
EI8475 meet on Tuesday from 15.15 – 17.45 REQUIRED COURSE TEXTS:
Paul R. Krugman & Maurice Obstfeld
RECOMMENDED COURSE TEXTS:
Dominick Salvatore Gregory Mankiw REQUIREMENTS:
A sitting examination for mid-term will be given at week 9.
A sitting examination for final will be given at week 18. This final exam changeable with 5 pages paper (optional for students) will be due at the end of the semester. Students will be given a list of several topics from which to select.
GRADING:
Grades will be computed as follows: Mid-Exam 30%; Final Exam 35%; Presentation 20%; Class Participation 5%, Assignments 10%. Details of grading will be explained.
COURSE SCHEDULE:
Weeks 2-4
The Economics of Trade
These sessions will cover the basic economic principles relating to international trade.
The following topics will be covered:
1. Mercantilism
2. Absolute Advantage and Comparative advantage 3. Gains from Trade
4. Factor endowments and trade patterns
5. The Instruments of Trade Policy (tariff, quota, etc)
6. Qualifications to the case for free trade: reciprocity, the optimal tariff, infant industries, etc.
Required Reading:
Paul R. Krugman, “Ricardo’s Difficult Idea: Why Intellectuals Don’t Understand Comparative Advantage,” G. Cook, ed., The Economics and Politics of International Trade (Routledge: 1998);
http://www.pkarchive.org/trade/ricardo.html
Paul R. Krugman & Maurice Obstfeld, The International Economics: Theory and Policy (Addison &
Wesley:2006) Week 5
The Evolution of the International Trading System.
These sessions will cover (1) The formation and evolution of the GATT from the initial 1947 concept through eight negotiating rounds and the creation of the WTO. (2) The rise of regional trading blocks and free trade areas (FTAs)- the EU, NAFTA
Required Reading:
Global Trading System (ANU Course power point presentation), lecturer: Chunlai Chen Topic 3-8.
Week 6-7
Tariffs and the Costs of Protection (go deeper)
D. Irwin, “Goodbye, Free Trade?” Wall Street Journal (October 8, 2010);
http://online.wsj.com/article/SB10001424052748704696304575538573595009754.html
A. Davidson, “World Sock Capital Suffers From Duty-Free Imports” (Nov. 27, 2007) and “Thriving Honduran Sock Industry May Disappear,” (Nov. 28, 2007); (audio);
http://www.npr.org/templates/story/story.php?storyId=16661333
Planet Money, “Why U.S. Taxpayers Are Paying Brazilian Cotton Growers” (Ocotber 29, 2010), http://www.npr.org/blogs/money/2010/10/29/130917279/the-friday-podcast-cotton-wars (audio)
E. Gresser, “Toughest on the Poor – America’s Flawed Tariff System,” Foreign Affairs (Nov/Dec 2002) Week 8
Arguments For and Against Trade Protection
Required Reading:
N. Gregory Mankiw and P. Swagel, “Antidumping: The Third Rail of Trade Policy,” Foreign Affairs (July- August 2005)
Week 9
Mid-Examination
Week 10-11
Fundamentals of the GATT and the WTO These sessions will cover the following topics:
-Non-discrimination: MFN and National Treatment -Tariffs
-Safeguards
-Developing countries (discussion will cover the evolution of theory and policy stances relating to the relationship between trade and development and the related evolution of the multilateral rules governing trade with developing nations.)
-Article XX: General Exceptions to GATT rules -Dispute settlement.
Required Reading:
Trebilcock and Howse, The Regulation of International Trade. 2
nd
edition. Routledge Press, pp. 25-38; 51-80; 167-172; 190-198; 205-214; 226-239; 245-254; 367-379; 386- 394
Week 11-13 Chinese Economy Student presentation
Week 13-17
Topics covered include:
1. Trade Liberalization K. SUBRAMANIAN
THE TRUTH ABOUT TRADE — The Real Impact of Liberalization: Clive George;
Books for Change, 139, Richmond Road, Bangalore-560025. Rs. 325.
2. WTO & RTA
3. WTO & Development: We will discuss efforts to more fully integrate developing nations into the WTO trading system and policies aimed at making the global trading system work for development
4. Trade Diversion and Trade Creation
5. The Role of NGOs in Shaping Globalization Week 18
Final Examination
GRADING
No Assessment Aspects Elements Assessment Percentage Score (Mark) 1 Knowledge and
understanding
1. Mid exam 2. Final exam
30 35
1. >= 80% : A 2. 60-79 % : B 3. 45-59 % : C 4. < 45 % : D 2 Intelectual and
practical skill
1. Presentation 2. Class Participation 3. Assignments
20 5 10
Total 100,00
