| ACTIVITIES | PERCENTAGES |
|---|---|
| Class participation | 10% |
| Problem sets (5% each) | 20% |
| Midterm exam | 30% |
| Final exam | 40% |
Table of Contents
Syllabus
Syllabus
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The calendar below lists topics by session.
Description
This course provides a graduate-level introduction to the field of international trade. Topics include gains from trade, Ricardian models of technological differences, Heckscher-Ohlin models of factor endowment differences, intermediate input trade, wage inequality, imperfect competition, firm heterogeneity, multinational firms, international organization of production, dynamics, trade policy, trade and institutions, sorting in trade and foreign direct investment (FDI), and effects of geography on trade. This course is targeted to second-year PhD students in economics.
Prerequisites
The prerequisites for this course include Intermediate Microeconomic Theory (14.04). Students are expected to have completed first-year PhD courses in Microeconomic and Macroeconomic Theory. I will not restrict enrollment but make sure you have an appropriate background.
Recommended Texts
There are no required textbooks. The reading list refers to the following books, which are very much worth buying, but will be on reserve at the library:
Dixit, Avinash, and Victor Norman. Theory of International Trade: A Dual, General Equilibrium Approach. Cambridge, UK: Cambridge University Press, 1980. ISBN: 9780521234818.
Feenstra, Robert. Advanced International Trade: Theory and Evidence. Princeton, NJ: Princeton University Press, 2003. ISBN: 9780691114101.
Grossman, Gene, and Elhanan Helpman. Innovation and Growth in the Global Economy. Cambridge, MA: MIT Press, 1991. ISBN: 9780262071369.
Grossman, Gene, and Kenneth Rogoff. Handbook of International Economics. Vol. 3. New York, NY: Elsevier, 1995. ISBN: 9780444815477.
Helpman, Elhanan, and Paul R. Krugman. Market Structure and Foreign Trade: Increasing Returns, Imperfect Competition, and the International Economy. Cambridge, MA: MIT Press, 1987. ISBN: 9780262580878.
Jones, Ronald, and Peter Kenen. Handbook of International Economics. Vol. 1. New York, NY: Elsevier, 1984. ISBN: 9780444867926.
Grading
There will be four problem sets, one midterm exam, and one final exam. You will have about two weeks to complete each problem set. The exams will be closed book and closed notes. The midterm and final exams will take place during regular lecture hours.
Recommended Citation
For any use or distribution of these materials, please cite as follows:
Pol Antràs, course materials for 14.581 International Economics I, Spring 2007. MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology. Downloaded on [DD Month YYYY].
| SES # | TOPICS | KEY DATES |
|---|---|---|
| I. Introduction: Trade facts and gains from trade | ||
| 1 | Trade facts and gains from trade | |
| II. Technological differences: Ricardian models | ||
| 2 | Technological differences: Ricardian models | Problem set 1 out |
| 3 | Eaton and Kortum's (2003) Ricardian model | |
| III. Factor endowment differences: Heckscher-Ohlin | ||
| 4 | The 2x2x2 Heckscher-Ohlin model: Part I | |
| 5 | The 2x2x2 Heckscher-Ohlin model: Part II | Problem set 1 due |
| 6 | The generalized Heckscher-Ohlin model | |
| IV. Empirical tests of the Heckscher-Ohlin model | ||
| 7 | Empirical tests of the Heckscher-Ohlin model | Problem set 2 out |
| V. Intermediate input trade and wage inequality | ||
| 8 | Intermediate input trade and wage inequality | |
| VI. Imperfect competition: Theory | ||
| 9 | Trade, external scale economics and oligopoly | |
| 10 | Trade and monopolistic competition | |
| VII. Imperfect competition: Empirics | ||
| 11 | Trade and monopolistic competition: Empirics | Problem set 2 due |
| VIII. Firm heterogeneity | ||
| 12 | Intraindustry heterogeneity in trade models: Part I | Midterm exam 2 days after Ses #12 |
| 13 | Intraindustry heterogeneity in trade models: Part II | |
| IX. Multinational firms | ||
| 14 | Technological theories of foreign direct investment (FDI) | Problem set 3 out |
| X. International organization of production | ||
| 15 | The transaction-cost approach in international trade | |
| 16 | The property-rights approach in international trade | |
| XI. Dynamics of international trade | ||
| 17 | Dynamic trade theory I: Trade and neoclassical growth | Problem set 3 due |
| 18 | Dynamic trade theory II: Trade, technology, and growth | Problem set 4 out |
| 19 | Dynamic trade theory III: Innovation, technology transfer, and product cycles | |
| XII. Trade policy | ||
| 20 | Trade policy I: Determinants of the structure of protection | |
| 21 | Trade policy II: Tariff retaliation and the World Trade Organization (WTO) | |
| 22 | Trade policy III: Regionalism versus multilateralism | Problem set 4 due and final exam 2 days after Ses #22 |
Additional units, time-permitting, include Trade and Institutions, Sorting in Trade and Foreign Direct Investment (FDI), and Trade and Geography.