International economics I

Table of contents
1 Introduction.- 1.1 International Economics as a distinct subject.- 1.2 The pure theory of international trade: an overview.- References.- 2 The classical (Ricardo-Torrens) theory of comparative costs.- 2.1 Comparative costs (advantages) and international trade.- 2.2 Alternative graphic representations.- 2.3 A modern interpretation in terms of optimization.- 2.3.1 Maximization of real income in each country.- 2.3.2 Maximization of real world income.- 2.4 Generalizations.- 2.4.1 Two goods and n countries.- 2.4.2 m goods and n countries.- 2.5 The problem of the determination of the terms of trade.- A.2.1 Maximization of world income and the dual problem.- A.2.2 Maximization of national income and minimization of real cost.- A.2.3 On the determination of the terms of trade.- References.- 3 The neoclassical theory of international trade.- 3.1 The transformation curve and the box diagram.- 3.2 General equilibrium in a simple closed economy.- 3.2.1 The supply curves.- 3.2.2 The demand curves.- 3.2.3 General equilibrium and Walras' law.- 3.3 General equilibrium in open economies and international trade.- 3.4 Marshallian reciprocal demand curves, international equilibrium, and stability.- 3.4.1 Derivation of the offer curve.- 3.4.2 International equilibrium and stability.- 3.5 Increasing returns to scale.- 3.6 The gains from trade.- 3.7 Generalizations.- A.3.1 The transformation curve and the box diagram.- A.3.1.1 A formal derivation of the transformation curve and its properties.- A.3.1.2 The convexity or concavity of the transformation curve.- A.3.1.3 Homogeneous production functions and the transformation curve.- A.3.2 A simple closed economy.- A.3.2.1 The basic model.- A.3.2.2 The supply side of the model.- A.3.2.3 The demand side of the model.- A.3.3 International trade and offer curves.- A.3.3.1 The equilibrium conditions. The offer curve and its slope.- A.3.3.2 Relationships between the various elasticities.- A.3.4 Stability.- A.3.4.1 Terms-of-trade adjustment.- A.3.4.2 Quantity adjustment.- A.3.5 Duality approach.- References.- 4 The Heckscher-Ohlin model.- 4.1 Basic assumptions and their meaning.- 4.1.1 Relative price of goods and relative price of factors.- 4.2 Proof of the fundamental theorem.- 4.3 Factor price equalization.- 4.3.1 A graphic treatment.- 4.4 Extensions and qualifications.- 4.4.1 Non-identical structures of demand.- 4.4.2 Factor-intensity reversals.- 4.5 Leontief's paradox and other empirical studies.- A.4.1 Factor-intensity reversals.- A.4.2 Proof of the fundamental theorem.- A.4.3 The factor price equalization theorem.- A.4.4 A brief outline of the generalizations of the Heckscher-Ohlin model..- References.- 5 Tariffs, protection, economic integration.- 5.1 Introduction.- 5.2 Partial equilibrium effects of a tariff.- 5.3 The so-called social costs of a tariff.- 5.4 General equilibrium effects of a tariff.- 5.4.1 The production-possibilities frontier and tariffs. The Stolper-Samuelson theorem.- 5.4.2 Tariffs and reciprocal demand curves.- 5.4.2.1 The Metzler and Lerner cases.- 5.4.3 The optimum tariff.- 5.5 Quotas and other non-tariff barriers.- 5.5.1 Quotas.- 5.5.2 Export duties.- 5.5.3 International cartels.- 5.5.4 Dumping.- 5.5.5 Other impediments to free trade.- 5.6 Free trade versus protection and the theory of second best.- 5.6.1 The optimum tariff again.- 5.6.2 The infant industry.- 5.6.3 Distortions in domestic goods markets.- 5.6.4 Distortions in domestic factor markets.- 5.6.5 Non-economic motives for protection.- 5.6.6 The theory of second best.- 5.7 Intermediate goods and the effective rate of protection.- 5.8 Customs unions and economic integration.- 5.8.1 The various degrees of integration.- 5.8.2 The effects of a customs union.- 5.8.3 Empirical problems.- 5.9. The "new" protectionism.- 5.9.1 Introductory remarks.- 5.9.2 Voluntary export restraints.- 5.9.3 Subsidies.- 5.9.4 The political economy of protectionism.- 5.9.4.1 The demand and supply of protection.- A.5.1 General equilibrium effects of a tariff: the Stolper-Samuelson theorem.- A.5.2 Tariffs, terms of trade, domestic relative price.- A.5.3 The optimum tariff.- A.5.4 Cartels; dumping.- A.5.5 The theory of second best.- A.5.6 The effective rate of protection.- A.5.7 Lobbies, political parties and endogenous tariff determination.- References.- 6 International trade and economic growth.- 6.1 Introduction.- 6.2 The effects of growth on the volume of trade.- 6.2.1 Consumption effects.- 6.2.2 Production effects.- 6.2.3 A reformulation in terms of elasticities; the total effect.- 6.3 Growth and terms of trade; immiserizing growth.- 6.3.1 The large country and the terms of trade.- 6.3.2 Immiserizing growth.- 6.4 Increase in factor endowments and international trade: Rybczynski's theorem.- 6.4.1 Rybczynski's theorem.- 6.4.2 An alternative diagram and the effects on the terms of trade.- 6.5 Technical progress and international trade.- 6.5.1 Types of technical progress.- 6.5.2 Effects of neutral technical progress on production levels and on the terms of trade.- 6.5.3 Effects of biased technical progress.- 6.5.3.1 Capital-saving progress in the capital-intensive sector.- 6.5.3.2 Labour-saving progress in the capital-intensive sector.- 6.5.4 Conclusion.- 6.6 Dynamic models.- 6.6.1 A simple closed-economy two-sector growth model.- 6.6.2 Extension to an open economy.- A.6.1 Classification of the effects of growth.- A.6.2 Comparative statics of the effects of growth in general.- A.6.2.1 Immiserizing growth.- A.6.3 Changes in factor endowments, Rybczynski's theorem, and the terms of trade.- A.6.3.1 Simultaneous increase in both factors.- A.6.4 Technical progress.- A.6.4.1 Effects of technical progress on factor intensities and factor rewards.- A.6.4.2 Effects of technical progress on output levels.- A.6.4.3 Effects of technical progress on the terms of trade.- A.6.5 Dynamic models.- A.6.5.1 A simple model.- A.6.5.2 Momentary equilibrium.- A.6.5.3 Long-run equilibrium.- References.- 7 Some refinements of the orthodox theory.- 7.1 Introduction.- 7.2 Transport costs and international trade.- 7.3 Intermediate goods.- 7.4 Elastic factor supply.- 7.5 Non-traded goods.- 7.6 Natural resources, specific productive factors, "Dutch disease" and de-industrialization.- 7.7 International factor mobility.- 7.8 International trade under uncertainty.- 7.9 Illegal transactions in international trade and the economic theory of smuggling.- A.7.1 The cost of transport.- A.7.2 Intermediate goods.- A.7.2.1 Final goods as inputs.- A.7.2.2 Pure intermediate goods.- A.7.3 Elastic supply of factors.- A.7.4 Non-traded goods.- A.7.4.1 The behaviour of the offer curve.- A.7.5 Specific factors and de-industrialization.- A.7.5.1 Effects on prices, outputs and factor rewards.- A.7.6 International factor mobility.- A.7.7 Uncertainty and international trade.- A.7.8 Smuggling.- References.- 8 The New Theories of International Trade.- 8.1 Introduction.- 8.2 The precursors.- 8.2.1 Availability.- 8.2.2 Technology gaps.- 8.2.3 The product cycle.- 8.2.4 Income effects.- 8.2.4.1 Linder"s theory.- 8.2.4.2 Barker"s variety hypothesis.- 8.2.5 Intra-industry trade: early explanations.- 8.3 Neo-Heckscher-Ohlin theories.- 8.4 Monopolistic competition and international trade.- 8.4.1 Introduction.- 8.4.2 A Simple synthesis model.- 8.5 Oligopoly and international trade.- 8.5.1 Introduction.- 8.5.2 Homogeneous commodities.- 8.5.3 Vertically differentiated goods.- 8.5.4 Horizontally differentiated goods.- A.8.1 A Neo-Heckscher-Ohlin model.- A.8.2 A model of monopolistic competition and international trade.- A.8.2.1 Love for varitey and demand.- A.8.2.2 The production side.- A.8.2.3 International trade.- A.8.2.4 Tariffs.- A.8.3 Homogeneous goods, oligopoly, and trade.- A.8.4 Vertically differentiated goods, oligopoly, and trade.- A.8.4.1 Consumers.- A.8.4.2 Firms, and market equilibrium.- A.8.4.3 International trade.- A.8.5 Horizontal differentiation, oligopoly, and trade.- A.8.5.1 Demand for characteristics.- A.8.5.2 The production side.- A.8.5.3 International trade and commercial policy.- References.- 9 Neo-Ricardian theories of international trade.- 9.1 Intermediate and capital goods in the orthodox theory.- 9.2 The debate between the orthodox theory and the neo-Ricardian theories.- References.- Name Index.