Indian Institute of Foreign Trade Program Name: EPGDIB 2022-2023
Course: International Economics
Course Coordinator: Sugandha Huria and Neha Jain Email: [email protected], [email protected]
Semester: II Credits: 2
Course Introduction:
While the world witnessed an orientation towards protectionism up to the period to mid- nineties, in the subsequent period countries tried to reform their policies in line with the multilateral reform agenda, i.e., the introduction of the World Trade Organization (WTO) policies. However, the recent recessions, including the one caused by the Pandemic, have caused several countries to adopt a cautious approach towards movement of merchandise products and services.The evolving scenario underlines the need to understand the determinants of both trade flows as well as trade policies.
This course has been designed to provide the conceptual and theoretical framework to understand the recent global developments in the arena of trade and investment to the participants. The discussions cover both Pure Theories of Trade as well as Trade Policy instruments. Under the Pure Theory of Trade, the basis of trade, gains from trade, direction of specialization and its effects on factors of production, development of global value-chains, etc. are covered. The discussions with the help of practical country cases would help one to understand the trade patterns and production, welfare implications. The discussions on Trade Policy instruments introduce the aspects of protectionism with respect to tariff, quota, and subsidies. The analysis would be instrumental in understanding their relative importance in trade policy formulation. The discussions on Regional Trade Agreements (RTA) cover the deepening trade integration between countries and the trade impacts and the concerns in the area of rules of origin. FDI issues are discussed for understanding the growing influence investment in developing cross-country production networks and trade in semi-processed products. Finally, discussions will be organized on some of the contemporary issues in trade and development to explore the linkages between poverty, environment and gender issues and trade.
Programme Learning Goals covered through this Course
● Learning Goal 1: International Perspective in Decision Making
● Learning Goal 2: Innovative Thinking with Critical Analysis
● Learning Goal 6: Effective Communication Skills
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Pedagogy
● Class room lectures, Class discussions, Case Studies, and Assignments. Active class participation will be encouraged during the course.
Linkages with other courses
• Business Economics, Courses linked to Global Business Environment, International Finance, and other courses with discussion on policies.
Evaluation Components, %
Quiz 20 (Lecture 8)
Group Presentations 35 (Lecture 13) Class Participation 5
End-Term Examination 40
Text Books
● (TP) Thomas A. Pugel, International Economics (17th Edition), McGraw Hill
Reference Books
● (DS) Dominick Salvatore, International Economics (11th Edition), John Wiley.
● (RC) Robert Carbough, Global Economics: Cengage Learning, latest Edition.
● (KO) Krugman & Obstfeld, International Economics: Theory and Policy.
# Session Plan
Session Topic and Sub topics
(with brief description of what intends to be achieved)
Reading Reference/Cases Module I: Pure Theory of Trade
1
● Why International Economics?
- Waves of Globalisation - Direction and Pattern of Trade
Chap. 1 (TP) + Class Notes
2, 3
● Development of Trade Theory - Theory of Absolute Advantage - Theories of Comparative Advantage
Case: India and Bangladesh – Sectors of Comparative Advantage Case: Diamond Trading & Cutting in a changing global economy
Chap. 2 and 3 (TP)
4, 5
● Gains from trade, and the impact of Economic Growth - Specialisation gains, and gains due to exchange - Growth and Trade
Chap. 4, 6 (TP)
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Case: Experience of Smaller Countries Case: Immiserising Growth
6, 7, 8
● Empirical Reality and Alternative Trade Theories - New Trade Theory
- New-New Trade Theory - Global Value Chains and FDI Case: Growth of intra-industry trade
Case: Scale Economies and Production Networks Activity: OECD – TiVA Database
Chap. 5, 10 (TP) + class notes
Module II: Trade Policy Instruments
9, 10
● Modes of Protectionism - Tariffs
- Non-Tariff Barriers
Activity: Barriers on Movement of Professionals – Application of OECD – STRI Database
Chap. 7, 8 (TP)
11, 12
● Regional Integration
- Types of Economic Integration and their implications on trade - Analysis of Free Trade Agreements, Customs Union
Case: India’s pull-out from RCEP
Chap. 9 (TP)
13 ● Presentations
Any Other Detailed Instructions / Information/ Additional Readings/ Journals (optional)
• “WTO Annual Report”, World Trade Organization, Geneva (various issues).
• “World Trade Report”, World Trade Organization, Geneva (various issues).
• “World Tariff Profile”, World Trade Organization, Geneva (various issues).
• “Trade and Development Report”, UNSTAD, Geneva (various issues).
