Term
| Why does intl econ require some tools different from micro/macro? |
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Definition
| Other issues arise when trade and investment occur between sovereign nations |
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Term
| Issues of Particular Concern (7) |
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Definition
Gains from Trade
Pattern of Trade
Protectionism
Balance of payments
Exchange rate determination
Intl policy coordination
Intl capital market |
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Term
| Major International Economic Problems Today (6) |
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Definition
Slow growth and high unemployment in advanced nations
Rise of trade protectionism in advanced countries
Excessive fluctuations and misalignment in exchange rates
Structural imbalances in advanced economies and insufficient restructuring in transition economies
Deep poverty in many developing countries
Resource scarcity, environmental degradation, climate change, unsustainable development |
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Term
| How do we know trade is beneficial? What might we use for evidence? |
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Definition
| Theoretical models, Data, Historical Comparison |
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Term
| Example of Theoretical Model evidence that trade is beneficial |
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Definition
| "The Principles of Political Economy & Taxation" (1817) by David Ricardo |
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Term
| Example of Data evidence that trade is beneficial |
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Definition
| Correlation between rise in trade and rise in standard of living and |
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Term
| Example of Historical Evidence evidence that trade is beneficial |
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Definition
| N. Korea trades only with China and have extremely low GDP; N. Korea is evidence that trade is a good thing |
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Term
| If we decide to trade, how do we decide who to trade with?; What determines trade patterns? |
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Definition
| Size, Distance, Barriers, Borders |
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Term
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Definition
Europe
1 Europe,
2 Asia,
3 N. America,
4 Middle East,
5 S & C America,
6 CIS (Commonwealth of Independent States),
7 Africa |
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Term
| What % of stuff made in N. America is traded to N. Am.? |
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Definition
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Term
| What % of African exports go to other African countries? |
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Definition
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Term
| Why do so few of Africa's exports go to Africa? |
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Definition
| Africa exports raw materials and African countries can't do anything with raw materials |
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Term
| What country imports 1/2 of the world's raw materials? |
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Definition
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Term
| What are some examples of trade barriers? |
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Definition
| tariffs, embargos, quotas, legal, health, environmental |
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Term
| If distance is most important factor, why do so many Canadian Provinces trade with British Columbia but U.S. states that are equidistant from from B.C. don't? |
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Definition
| Distance matters but isn't the only important factor, borders matter too |
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Term
| Which countries do the least amount of trading? |
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Definition
| Countries with the highest tariffs |
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Term
| Is trade today different than it was in the past? How? |
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Definition
| Yes - ease of global communication, easier to travel from country to country |
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Term
| Has trade changed before? |
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Definition
| Yes - Panama Canal, transportation revolutions (steamship and railroads) |
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Term
| What do we trade today? (Composition of World Trade) |
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Definition
Manufactures (59.32%)
Services (19.59%)
Mining (14.18%)
Agricultural (6.91%) |
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Term
| How has the composition of developing-country exports changed? |
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Definition
Increase in export of manufactured goods (~10% in 1960 and ~65% in 2001)
Decrease in export of agricultural goods (~60% in 1960 and ~10% in 2001) |
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Term
| Who is the largest international trader? #2? #3? |
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Definition
#1: United States
#2: Germany
#3: China |
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Term
| What % world exports is U.S.? |
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Definition
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Term
| How much money in U.S. exports? What % of U.S. production? |
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Definition
| $1.8 trillion in exports; 13% of U.S. production |
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Term
| What % world imports is U.S.? |
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Definition
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Term
| How much money in U.S. imports? What % of U.S. production? |
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Definition
| $2.5 trillion in imports; 18% of U.S. production |
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Term
| How do we measure Degree of Integration (Interconnectedness)? |
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Definition
Physical Trade Flows
Capital Flows: Financial and Physical
Labor Flow
Price Similarities Across Markets |
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Term
| How have capital flows (financial and physical) changed? |
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Definition
| Used to be strict regulations but not very strict now |
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Term
| Is labor free-flowing between Mexico and US? Free-flowing in the EU? |
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Definition
| Labor is not free-flowing between Mexico and US but is free-flowing in EU |
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Term
| How has openness index changed from 1913-2000 for France, Netherlands, Germany, UK, Japan, and US? Which country has consistently had highest openness index? Lowest? |
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Definition
1913-1950: decrease
1950-1973: increase
1973-2006: largest increase
Highest: Netherlands
Lowest: United States
(Netherlands, UK, Germany, France, Japan, US) |
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Term
| What is Gross Domestic Product (GDP)? |
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Definition
| a measure of total production |
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Term
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Definition
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Term
| What types of countries tend to have smaller trade to GDP ratios? Why? |
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Definition
| Smaller countries because larger countries, in general, are less dependent on international trade because their firms can reach an optimal production size without having to trade to foreign markets |
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Term
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Definition
| Reduction of tariffs and the elimination of quotas |
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Term
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Definition
| Negotiations over domestic policies that impact international trade (much more difficult to accomplish) |
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Term
| What % of US goods are produced domestically? |
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Definition
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Term
| Evidence that we are in new era of trade (4) |
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Definition
| Rapid technological change, Business and financial sector innovation, Trade policy liberalization, Widespread protests against immigration |
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Term
| Trade Changes between 1870 and 1914 (4) |
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Definition
| Railways, steamships, and telegraphs; New business models, development of stock market; Many nations changed policies; Popular protests |
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Term
| What is new about trade today? (7) |
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Definition
| Technology, Flexible exchange rates, Shallow integration, Changing mix of goods, Deep integration, RTAs, Multilateral organizations |
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