Questions tagged [international-trade]
International trade theory is a sub-field of economics which analyzes the patterns of international trade, its origins, and its welfare implications.
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Deriving Unit cost function
Unit cost function is the minimum cost to produce one unit of output.
The solution to the above problem is:
where ai(w,r) is the amount of labour needed to produce 1 unit of good i at factor prices (...
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Would poorer countries be better off by cutting off all trade with rich countries?
This question is related to another thread, but rather than hijack that thread I am posting my angle on it here.
In relation to this Guardian quote
If we add theft through trade in services to the ...
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Increasing Returns to Scale and Perfect Competition
Increasing returns to scale due to internal economies are incompatible with perfect competition BUT increasing returns to scale due to external economies are compatible with perfect competition
SOURCE:...
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direction of causality between Increasing returns to scale and economies of scale
Does increasing returns to scale cause economies of scale OR is it the other way around?
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the relationship between Returns to Scale and shape of Production Possibility Frontier (PPF)?
Guys any material that discusses the above in detail for a two commodity case?
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Would Bretton-Woods capital controls have prevented the export-based industrialization of China and the deindustrialization of the West?
I sometimes hear this in a certain kind of political discourse, namely that in the "good old days" of Bretton-Woods capital controls were a thing (I don't dispute this) and that consequently ...
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What are some good alternative textbooks in international trades for undergraduates other than 'Taylor & Feenstra' and 'Krugman, Obstfeld & Melitz'?
I've been referring to the textbooks International Economics by Alan M. Taylor and Robert C. Feenstra and International Trade: Theory and Policy by Marc Melitz, Maurice Obstfeld, and Paul Krugman ...
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What is the logic behind Krugman's argumentation about dumping?
I don't quite understand what he is trying to say. As I see it, a lower marginal cost should lead to an increase in export prices, not the opposite.
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Why was the USD rangebound between 1987 and 1995 from an economic standpoint?
I'm trying to understand what caused this long period of range boundedness for the USD index from 1987-1995 from an economic standpoint.
From my understanding. In 1985 the USD had reached it's ...
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Could Foreign Exchange rates fluctuate under a Gold Standard system?
I recently read an article where it said that during the gold standard, right before world war 1, 1 GBP went from equaling \$4.87 to soaring up to \$6.75 . My understanding always was that Forex rates ...
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gravity model of trade
I am conducting an analysis to assess the impact of the CETA trade agreement on trading margins using the gravity equation. One of the challenges I'm facing is how to calculate the distance variable ...
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Why doesn't imports from receiving country match exports from sending country?
I was looking at import/export data between the Cayman Islands and the Netherlands on tradingeconomics.com (tradingeconomics.com/cayman-islands/imports/netherlands) and (tradingeconomics.com/...
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What happens when a country trades with a specific country using that country's currency?
Suppose, a country X trades with another country Y using Y's currency rather than widely ...
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Effect of the construction of the Suez Canal on economies of southern Africa
Merchant ships, before the inauguration of the Suez Canal, used to travel between large parts of Asia and Europe by travelling around Africa. I feel this must have boosted the economies of many of the ...
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Is John Maynard Keynes an economic liberal or an economic nationalist?
I am working on a research project about political economy. However, I stumbled upon differences in the interpretation of the orientation of John Maynard Keynes. Some sources indicate that Keynes is a ...
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BOP balancing to 0, use of capital and financial account
Please someone for the love of god help me. I can't find two sources on the internet that don't have conflicting or very difficult to understand information on the balance of payments.
I have various ...
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How could the economic cost of EORI number requirements in Europe be estimated?
A friend recently tried to ship me my laptop from Romania (a EU member) to Montenegro (a EU candidate member). Even though neither of us is a business, and the laptop was mine and used, my friend had ...
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What is Xijinping’s long game with regards to suppression of tech sector and foreign businesses
It’s not clear to me if Xijinping is simply jingoistic and incompetent or if there is a long game at work with respect to his economic policy. Making consistent headlines is his increasingly hostile ...
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How to write the system of equations in matrix form
How to write the following equilibrium system equation as matrix from
$X_n^{j \prime}=\sum_{k=1}^J \gamma_n^{j, k} \sum_{i=1}^N \frac{\pi_{i n}^{k^{\prime}}(\hat{\mathbf{w}})}{1+\tau_{i n}^{k^{\prime}}...
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How does breaking away from a larger nation effect the economy
I am working on making a fictional world, and I really want to make the economics realistic, so I decided to come here to ask questions. The context is that a large nation went through a large civil ...
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Measuring the Overall Effect of Joining a Trade Agreement
The UK has signed a deal to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). The BBC comments that, on the government's own estimate, this will add only 0.08% ...
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Interpretation of the Elements of the Leontief Inverse (Total Requirements Matrix)
I found what I believe to be slightly different interetations of the individual elements of the Leontief Inverse (total requirements matrix):
Miller and Blair (2009) just after Equation (2.12) mention ...
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Factor changes in Melitz (2003) model
What would be the effect of changes in factor supplies, for example labor, on the open economy equilibrium?
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Does the Rybczynski theorem also hold in modern trade theory models?
Does the Rybczynski theorem also hold for modern Melitz (2003) type trade models?
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What is the economical perspective of the value of an egg globally if we take in some hypothetical considerations?
I am fairly new to economics and doing some research, so pardon my lack of knowledge on the topic if this is a dumb question.
The main question i have is: Does an egg have the same value around the ...
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Questions regarding Solving Melitz (2003) model
I am editing my question regarding solving the model in order to be more specific.
Regarding the demand side, In the beginning of the model, we have a CES utility function over a continuum of goods
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US WTO Most favoured nation tariffs higher than bound tariffs. Why?
.....so I was reading this:
https://blogs.worldbank.org/trade/picture-trade-types-tariffs-explained
"Bound Tariffs are specific commitments made by individual WTO member
governments. The bound ...
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Trade and Opportunity Cost
This is a question on opportunity cost. I had problem in solving the last part. Please help me out.
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What actually is comparative advantage?
Is comparative advantage determined by simple productivity? In other words, a production function that takes in... some kind of input, uses labor, and capital, and produces an output? In this case, is ...
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How would the world economy change if intercontinental transport was five times more expensive than today?
I am asking this question in light of climate change mitigation. I am working with the assumption that many ways of emitting green house gases can be stopped with better technologies. Electric cars ...
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What is the acquired advantage theory in international trade?
Is it the comparative advantage or absolute advantage or something all together different?
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How did empires make wealth out of empire-colony trade?
It is commonly discussed that one way the empires of 16-18th would receive wealth from colonies is:
Get raw materials from a colony
Transport them to the empire
Make more sophisticated products out ...
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Was the council bill system used in British India a wealth extraction mechanism?
Jason Hickel says that the council bill system used to pay exporters of Indian goods during the British Raj was a mechanism by which Britain extracted wealth from India without giving India anything ...
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Reference request: book on international trade theory will full mathematical derivations
I am doing some self-study on international trade theory, and have been using the book by Feenstra Advanced International Trade Theory as my textbook. The book is good and relatively rigorous, but my ...
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Why does Taiwan dominate the semiconductors market?
The recent visit of US politician Nancy Pelosi to Taiwan generated a lot of news about the dependence the world has on Taiwan, given its dominance of the semiconductor market.
But I couldn't find ...
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Why do certain modern country leaders care about trade deficits so much?
A central tenet of mercantilism is that every country should strive to have favorable balance of payments. However, this theory has long been abandoned (or so it seems), but leaders still appear to ...
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How to get Customs data for importing companies?
I am looking for customs data for importing companies for each country.
I found some of them, for instance Canadian Importers Database
But I wonder if any of you know the additional free sources. ...
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If the value of the currency of an economy rises, then is it less desirable to trade with that economy?
I recently heard on a video that when the value of the currency of an economy rises, it is less desirable to trade with that economy. I couldn't understand it.
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Would the more robust global economy resulting from the abolition of trade be worth any costs? What would happen to the economy?
How can a giant volcanic eruption devastate the world?
Aside from the immediate fatalities,
the eruption can devastate the world’s economy and climate cannot be understated. A good comparison would be ...
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No profits if labour is the only input into production?
I'm studying the Richardian model now - it says that, if labour is the only input into production, there are no profits, so workers receive the full value of their output - i can't wrap my head around ...
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Where to find historical international export data?
Writing a paper on revealed comparative advantage and it’d be super helpful to have historical data on exports of different goods going back 30+ years. Ideally I’d be able to filter by industry and ...
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Effect of Quota on imported goods
Can someone explain why? As far as I am concerned, quotas increase the price, decrease the consumer surplus, and increase the producer surplus.
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When the country's currency is falling, does it make sense for Central Bank to intervene beyond curbing Volatity?
Consider a country who have more imports than exports. If the country's currency is falling badly with reference to the dollar (and the dollar is the main trading currency for the said country), then ...
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What does Milton Friedman mean by - "if they sell things to us in dollars then they are going to spend those dollars back here" (link below)
https://www.youtube.com/watch?v=fkHdq_2EUk4&ab_channel=FreeToChooseNetwork
I'm currently studying international trade at the undergraduate level. I feel like I should understand this, but Milton ...
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Is debt eventually negative for nonnegative $y_t\to 0,c_t\not\to 0$?
Suppose $d_t=\sum_{k=0}^\infty \rho^k (y_{t+k}-c_{t+k})$ and $\rho\in (0,1),y_t\geq 0,c_t>0\quad \forall t\geq 0$. Does $y_t\to 0,c_t\not\to 0$ imply $d_t$ is eventually negative?
My initial hunch ...
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Why hasn't Lukashenka's regime collapsed, for purely economical reasons?
Following the Ryanair incident, pretty much all Belarusian exports are now banned by the EU, its key trade partner (including oil products and potassium). Putin now has other pressing matters to ...
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How to detect verion of HS 6 digits code?
I have trade data with HS 6 digits codes. However, I don't know which version of HS is used.
I wonder if there is any practice in statistics to detect which version (HS1, HS2...HS5) is used?
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Perception of value between different currencies
So let's say I am going to sell a game and I'm trying to come up with a fair price.
The thing is, I am from Brazil and I'm selling in an online platform where most products are priced in dollars.
The ...
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What would happen if China were to suddenly stop all trade with the US?
What would happen if China were to suddenly stop all trade with the US (for political reasons)? Have any respectable economists made any predictions about the consequences of such a move for the ...
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Under what circumstances does trade yield Pareto-inferior results?
The usual assumption is that free trade always increases aggregate gains. This has in fact been proven for various models of trade between countries, though there are counterexamples if one makes ...
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