International Trade

Cover
Title Page
Copyright
About the Authors
Dedication
Brief Contents
Contents
Preface
Part 1: Introduciton to International Trade
	Chapter 1: Trade in the Global Economy
		1 International Trade
			The Basics of World Trade
				HEADLINES: Sum of iPhone Parts: Trade Distortion
			APPLICATION: Is Trade Today Different from the Past?
			Map of World Trade
			Trade Compared with GDP
			Barriers to Trade
			“First Golden Age” of Trade
			“Second Golden Age” of Trade
				HEADLINES: A Sea Change in Shipping 50 Years Ago
		2 Migration and Foreign Direct Investment
			Map of Migration
			Map of Foreign Direct Investment
		3 Conclusions
			Keypoints, Key Terms, and Problems
Part 2: Patterns of International Trade
	Chapter 2: Trade and Technology: The Ricardian Model
		1 Reasons for Trade
			Proximity
			Resources
			Absolute Advantage
				SIDE BAR: Can Comparative Advantage Be Created? The Case of “Icewine”
			Comparative Advantage
				SIDE BAR: David Ricardo and Mercantilism
		2 Ricardian Model
			The Home Country
			The Foreign Country
			APPLICATION: Comparative Advantage in Apparel, Textiles, and Wheat
		3 Determining the Pattern of International Trade
			International Trade Equilibrium
			APPLICATION: Labor Productivity and Wages
		4 Solving for International Prices
			Home Export Supply Curve
			International Trade Equilibrium
			APPLICATION: The Terms of Trade for Primary Commodities
		5 Conclusions
			Key Points, Key Terms, and Problems
	Chapter 3: Gains and Losses from Trade in the Specific-Factors Model
		1 Specific-Factors Model
			The Home Country
			The Foreign Country
			Overall Gains from Trade
			APPLICATION: How Large Are the Gains from Trade?
		2 Earnings of Labor
			Determination of Wages
			Change in Relative Price of Manufactures
			APPLICATION: Manufacturing and Services in the United States: Employment and Wages Across Sectors
			APPLICATION: Trade Adjustment Assistance Programs: Financing the Adjustment Costs of Trade
		3 Earnings of Capital and Land
			Determining the Payments to Capital and Land
				HEADLINES: Services Workers Are Now Eligible for Trade Adjustment Assistance
			Numerical Example
			What It All Means
			APPLICATION: Prices in Agriculture
		4 Conclusions
			HEADLINES: Rise in Coffee Prices—Great for Farmers, Tough on Co-ops
			Key Points, Key Terms, and Problems
	Chapter 4: Trade and Resources:The Heckscher-Ohlin Model
		1 Heckscher-Ohlin Model
			Assumptions of the Heckscher-Ohlin Model
			APPLICATION: Are Factor Intensities the Same Across Countries?
			No-Trade Equilibrium
			Free-Trade Equilibrium
		2 Testing the Heckscher-Ohlin Mode
			Leontief’s Paradox
			Factor Endowments in 2010
			Differing Productivities Across Countries
				HEADLINES: China Drawing High-Tech Research from U.S.
			Leontief’s Paradox Once Again
		3 Effects of Trade on Factor Prices
			Effect of Trade on the Wage and Rental of Home
			Determination of the Real Wage and Real Rental
			Changes in the Real Wage and Rental: A Numerical Example
			APPLICATION: Opinions Toward Free Trade
		4 Conclusions
			Key Points, Key Terms and Problems
	Chapter 5: Movement of Labor and Capital Between Countries
		1 Movement of Labor Between Countries: Migration
			Effects of Immigration in the Short Run: Specific-Factors Model
			APPLICATION: Immigration to the New World
			APPLICATION: Immigration to the United States and Europe Today
				HEADLINES: Call for Return of Border Controls in Europe
				HEADLINES: The Economic Windfall of Immigration Reform
			Other Effects of Immigration in the Short Run
			Effects of Immigration in the Long Run
			Rybczynski Theorem
			Factor Price Insensitivity Theorem
			APPLICATION: The Effects of the Mariel Boat Lift on Industry Output in Miami
			APPLICATION: Immigration and U.S. Wages, 1990–2006
		2 Movement of Capital Between Countries: Foreign Direct Investment
			Greenfield Investment
			FDI in the Short Run: Specific-Factors Model
			FDI in the Long Run
			APPLICATION: The Effect of FDI on Rentals and Wages in Singapore
		3 Gains from Labor and Capital Flows
			HEADLINES: The Myth of Asia’s Miracle
			Gains from Immigration
				SIDE BAR: Immigrants and Their Remittances
			APPLICATION: Gains from Migration
			Gains from Foreign Direct Investment
		4 Conclusions
			Key Points, Key Terms, and Problems
Part 3: New Explanations for International Trade
	Chapter 6: Increasing Returns to Scale and Monopolistic Competition
		1 Basics of Imperfect Competition
			Monopoly Equilibrium
			Demand with Duopoly
		2 Trade Under Monopolistic Competition
			Equilibrium Without Trade
			Equilibrium with Free Trade
		3 The North American Free Trade Agreement
			Gains and Adjustment Costs for Canada Under NAFTA
				HEADLINES: The Long and the Short of the Canada-U.S. Free Trade Agreement
			Gains and Adjustment Costs for Mexico Under NAFTA
				HEADLINES: NAFTA Turns 15, Bravo!
				HEADLINES: Nearly 20 Years After NAFTA, First Mexican Truck Arrives In U.S. Interior
			Gains and Adjustment Costs for the United States Under NAFTA
		4 Intra-Industry Trade and the Gravity Equation
			Index of Intra-Industry Trade
			The Gravity Equation
			APPLICATION: The Gravity Equation for Canada and the United States
		5 Conclusions
			Key Points, Key Terms and Problems
	Chapter 7: Offshoring of Goods and Services
		SIDE BAR: “Foreign Outsourcing” Versus “Offshoring”
		1 A Model of Offshoring
			Value Chain of Activities
			Changing the Costs of Trade
			APPLICATION: Change in Relative Wages Across Countries
			Change in Relative Wages in the United States
			Change in Relative Wages in Mexico
		2 The Gains from Offshoring
			Simplified Offshoring Model
			Production in the Absence of Offshoring
			Terms of Trade
			APPLICATION: U.S. Terms of Trade and Service Exports
		3 The Politics and Future of Offshoring
			HEADLINES: How to Destroy American Jobs
			HEADLINES: Caterpillar Joins “Onshoring” Trend
			The Future of U.S. Comparative Advantage
		4 Conclusions
			Key Points, Key Terms and Problems
Part 4: International Trade Policies
	Chapter 8: Import Tariffs and Quotas Under Perfect Competition
		1 A Brief History of the World Trade Organization
		2 The Gains from Trade
			Consumer and Producer Surplus
				SIDE BAR:Key Provisions of the GATT
			Home Welfare
			Home Import Demand Curve
		3 Import Tariffs for a Small Country
			Free Trade for a Small Country
			Effect of the Tariff
			Why and How Are Tariffs Applied?
				SIDE BAR: Safeguard Tariffs
			APPLICATION: U.S. Tariffs on Steel and Tires
		4 Import Tariffs for a Large Country
			Foreign Export Supply
			Effect of the Tariff
			APPLICATION: U.S. Tariffs on Steel Once Again
		5 Import Quotas
			Import Quota in a Small Country
				HEADLINES: Banana Wars
				HEADLINES: Sugar Could Sweeten U.S. Australia Trans-Pacific Trade Talks
			APPLICATION: China and the Multifibre Arrangement
		6 Conclusions
			Key points, Key Terms and Problems
	Chapter 9: Import Tariffs and Quotas Under Imperfect Competition
		1 Tariffs and Quotas with Home Monopoly
			No-Trade Equilibrium
			Free-Trade Equilibrium
			Effect of a Home Tariff
			Effect of a Home Quota
			APPLICATION: U.S. Imports of Japanese Automobiles
		2 Tariffs with Foreign Monopoly
			Foreign Monopoly
			APPLICATION: Import Tariffs on Japanese Trucks
				HEADLINES: The Chickens Have Come Home to Roost
		3 Dumping
			Numerical Example of Dumping
		4 Policy Response to Dumping
			Antidumping Duties
			APPLICATION: United States Imports of Solar Panels from China
			APPLICATION: Antidumping Duties Versus Safeguard Tariffs
		5 Infant Industry Protection
			Free-Trade Equilibrium
			Tariff Equilibrium
			APPLICATION: Examples of Infant Industry Protection
			Government Policies in the Solar Panel Industry
			U.S. Tariff on Heavyweight Motorcycles
				HEADLINES: Solar Flares
			Computers in Brazil
			Protecting the Automobile Industry in China
				HEADLINES: Milestone for China Car Output
				HEADLINES: Shanghai Tie-Up Drives Profits for GM
		6 Conclusions
			Key Points, Key Terms, and Problems
	Chapter 10: Export Policies in Resource and High-Technology Industries
		1 WTO Goals on Agricultural Export Subsidies
			Agricultural Export Subsidies
			Other Matters from the Hong Kong WTO Meeting
		2 Export Subsidies in a Small Home Country
			Impact of an Export Subsidy
		3 Export Subsidies in a Large Home Country
			Effect of the Subsidy
			APPLICATION:Who Gains and Who Loses?
				HEADLINES: G8 Shifts Focus from Food Aid to Farming
				HEADLINES: Hunger and Food Security Back on Political Agenda
		4 Production Subsidies
			Effect of a Production Subsidy in a Small Home Country
			Effect of the Production Subsidy in a Large Home Country
		5 Export Tariffs
			Impact of an Export Tariff in a Small Country
			Impact of an Export Tariff in a Large Country
		6 Export Quotas
			APPLICATION: Chinese Export Policies in Mineral Products
		7 High-Technology Export Subsidies
			HEADLINES: China Signals Support for Rare Earths
			“Strategic” Use of High-Tech Export Subsidies
			Effect of a Subsidy to Airbus
			Subsidy with Cost Advantage for Boeing
			APPLICATION: Subsidies to Commercial Aircraft
		8 Conclusions
			HEADLINES: EU Seeks $12 billion from US over Boeing Aid
			Key Points, Key Terms, and Problems
	Chapter 11: International Agreements: Trade, Labor, and the Environment
		1 International Trade Agreements
			The Logic of Multilateral Trade Agreements
			Regional Trade Agreements
			Trade Creation and Trade Diversion
			Numerical Example of Trade Creation and Diversion
				HEADLINES: China-ASEAN Treaty Threatens Indian Exporters
			Trade Diversion in a Graph
			APPLICATION: Trade Creation and Diversion for Canada
		2 International Agreements on Labor Issues
			Labor Side Agreement Under NAFTA
			Other Labor Agreements
				HEADLINES: Wal-Mart Orders Chinese Suppliers to Lift Standards
				HEADLINES: American Tariffs, Bangladeshi Deaths
				HEADLINES: U.S. Suspends Bangladesh’s Preferential Trade Status
		3 International Agreements on the Environment
			Environmental Issues in the GATT and WTO
			Does Trade Help or Harm the Environment?
			Examples of the Environmental Impact of Trade
			The Tragedy of the Commons
			International Agreements on Pollution
			APPLICATION: The Kyoto Protocol and the Copenhagen Accord
		4 Conclusions
			HEADLINES: Dismal Outcome at Copenhagen Fiasco
			Key Points, Key Terms, and Problems
Index