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Олон улсын худалдаа
 

Олон улсын худалдаа

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Олон улсын худалдаа Олон улсын худалдаа Presentation Transcript

  • International Trade
  • The Gains from Trade
    • The law of comparative advantage
      • specialisation as the basis for trade
      • absolute advantage
      • comparative advantage
      • the gains from trade based on comparative advantage
  • Production possibilities for two countries Pre-trade exchange ratios Less developed country: 2 wheat for 1 cloth Developed country: 1 wheat for 2 cloth International trade exchange ratios Less developed country: 1 wheat for 1 cloth Developed country: 1 wheat for 1 cloth (LDC exports wheat: DC exports cloth)
  • Production possibilities for two countries Pre-trade exchange ratios Less developed country: 2 wheat for 1 cloth Developed country: 1 wheat for 2 cloth International trade exchange ratios Less developed country: 1 wheat for 1 cloth Developed country: 1 wheat for 1 cloth (LDC exports wheat: DC exports cloth)
  • Production possibilities for two countries Pre-trade exchange ratios Less developed country: 2 wheat for 1 cloth Developed country: 1 wheat for 2 cloth International trade exchange ratios Less developed country: 1 wheat for 1 cloth Developed country: 1 wheat for 1 cloth (LDC exports wheat: DC exports cloth)
  • Production possibilities for two countries Pre-trade exchange ratios Less developed country: 2 wheat for 1 cloth Developed country: 1 wheat for 2 cloth International trade exchange ratios Less developed country: 1 wheat for 1 cloth Developed country: 1 wheat for 1 cloth (LDC exports wheat: DC exports cloth)
  • The Gains from Trade
    • The limits to specialisation and trade
    • The terms of trade
      • P X / P M
    • Other reasons for gains from trade
      • decreasing costs
      • differences in demand
      • increased competition
      • trade as an ‘engine of growth’
      • non-economic advantages
  • Arguments for Restricting Trade
    • Methods of restricting trade
      • tariffs
      • quotas
      • administrative barriers
      • other
    • Arguments for restricting trade
      • infant industry argument
      • changing comparative advantage
      • to prevent dumping
  • Arguments for Restricting Trade
    • Arguments for restricting trade (cont.)
      • to prevent establishment of a foreign-based monopoly
      • to spread risks
      • externalities
      • pursuing national interests (but against world interests)
        • exploiting monopoly power
        • protecting declining industries
      • non-economic arguments
  • Arguments for Restricting Trade
    • Problems with protection
      • protection as ‘second best’
      • world multiplier effects
      • retaliation
      • cushions inefficiency
      • bureaucracy
    • Measuring the efficiency loss from protection
  • The cost of protection O P Q S dom (= MC ) Q 1 Q 2 S world P W D dom
  • The cost of protection O P Q S dom (= MC ) S world + tariff S world a Q 1 Q 2 P W + t P W D dom Area edbc equals loss of consumer surplus d e c b Q 3 Q 4 Tariff
  • The cost of protection O P Q S dom (= MC ) S world + tariff S world a Q 1 Q 2 Q 3 Q 4 P W + t P W D dom Area 3 equals gain in tariff revenue Area 1 equals gain in producer surplus d e c b 1 2 3 4 Tariff
  • The cost of protection O P Q S dom (= MC ) S world + tariff S world a 1 2 3 4 Q 1 Q 2 Q 3 Q 4 P W + t P W D dom Areas 2 + 4 equals net loss d e c b Tariff
    • History of protection
      • Pre-war growth in protection
      • Post-war reduction in protection and the role of GATT
        • the growth in world trade
    World Attitudes towards Trade and Protection
  • Growth in world real GDP and world merchandise exports Source: Trade Statistics , WTO (www.wto.org)
  • Growth in world real GDP and world merchandise exports Growth in real GDP Source: Trade Statistics , WTO (www.wto.org)
  • Growth in world real GDP and world merchandise exports Growth in real GDP Growth in merchandise exports Source: Trade Statistics , WTO (www.wto.org)
    • Re-emergence of protectionism in 1980s
      • the increasing use of non-tariff barriers
    • The Uruguay Round
      • aims of the negotiations
      • problems in reaching agreement
      • the agreement
      • assessing the agreement
    World Attitudes towards Trade and Protection
    • The World Trade Organisation
      • WTO more powerful than GATT
      • WTO rules
        • non-discrimination
        • reciprocity
        • general prohibition of quotas
        • fair competition
        • binding tariffs
      • attitudes of the WTO
      • WTO activity in recent years
        • resistance from various groups to unfettered trade
    World Attitudes towards Trade and Protection
  • Trading Blocs
    • Types of preferential trading arrangement
      • free trade areas
      • customs unions
      • common markets
        • features of a full common market
    • Direct effects of a customs union
      • trade creation
      • trade diversion
  • Trading Blocs
    • Long-term effects of a customs union
      • longer-term advantages
        • internal economies of scale
        • external economies of scale
        • better terms of trade
        • increased competition between members
      • longer-term disadvantages
        • certain regions of the union may suffer
        • possibility of oligopolistic collusion
        • administrative costs
  • Preferential Trading in Practice
    • Preferential trading in practice
      • the EU
      • the EEA
      • NAFTA
        • the advent of NAFTA
        • experience to date
        • proposals to extent to an all Americas free trade area
      • the Asia-Pacific Economic Co-operation forum (APEC)
      • other free trade areas / customs unions
  • The European Union
    • Historical background
    • The economic nature of the EU
    • Development of common EU policies
      • Common Agricultural Policy
      • regional policy
      • competition policy
      • tax harmonisation
      • social policy
      • trade policy
  • The European Union
    • The single market
      • historical background
      • the Single European Act
      • completing the single market
    • The benefits of the single market
      • trade creation
      • reduction in the direct costs of barriers
      • economies of scale
      • greater competition
  • The European Union
    • Criticisms of the single market
      • radical economic change is costly
      • adverse regional effects
      • development of monopoly / oligopoly power
      • trade diversion
      • political objections: loss of sovereignty
    • Developments of the single market
      • evidence of economic benefits
      • eliminating remaining barriers
        • Internal Market scoreboard
      • effects of expansion of the EU
  • Trade and Developing Countries
    • Trade strategies
      • primary outward looking
      • secondary inward looking
        • import-substituting industrialisation (ISI)
      • secondary outward looking
        • possibly complemented by primary inward looking
  • Trade and Developing Countries
    • Approach 1: exporting primaries
      • justification for exporting primaries
        • exploits comparative advantage
        • a 'vent for surplus'
        • an 'engine for growth'
      • problems with traditional trade theory
        • comparative costs change over time
        • benefits may not flow to nationals
        • trade my lead to greater inequality
        • externalities from mines and plantations
  • Trade and Developing Countries
    • Exporting primaries (cont.)
      • long-term problems for primary exporting countries
        • low income elasticity of demand
        • protection in advanced countries
        • technological developments
          • synthetic substitutes
          • miniaturisation
        • rapid growth in imports
        • adverse movements in terms of trade
  • World primary commodity prices (1990 = 100)
  • World primary commodity prices (1990 = 100)
  • World primary commodity prices (1990 = 100)
  • World primary commodity prices (1990 = 100)
  • Average annual changes in prices of various products
  • Average annual changes in prices of various products
  • Trade and Developing Countries
    • Approach 2: ISI
      • justifications
        • problems of primary exporting
        • dynamic potential in manufacturing
          • infant industries
          • rapid technological advance
      • patterns of protection
        • selecting industries for protection
        • tariff and quota escalation
        • attracting multinational investment
  • Trade and Developing Countries
    • Approach 2: ISI (cont.)
      • adverse effects of ISI
        • often counter to comparative advantage
        • tends to cushion inefficiency
          • encourages establishment of monopolies
        • artificially low interest rates
          • use of capital-intensive techniques
        • encourages rural–urban migration
        • adverse effects on rural sector
        • leads to greater inequality
        • environmental problems
        • limit to home market
  • Trade and Developing Countries
    • Approach 3: exporting manufactures
      • transition from inward-looking to outward-looking industrialisation
        • a neutral trade approach
        • active promotion of manufactured exports
      • benefits from exporting manufactures
        • conforms more closely with comparative advantage
        • increased competition
        • increased investment
        • more employment and greater equality
  • Growth rates and export performance of selected secondary outward-looking countries
  • Growth rates and export performance of selected secondary outward-looking countries
  • Growth rates and export performance of selected secondary outward-looking countries
  • Growth rates and export performance of selected secondary outward-looking countries
  • Growth rates and export performance of selected secondary outward-looking countries
  • Trade and Developing Countries
    • Approach 3: exporting manufactures (cont.)
      • drawbacks of exporting manufactures
        • possible retaliation from advanced countries
          • but attitudes of WTO
        • competition from other developing countries
        • vulnerability to world fluctuations
          • world recessions
          • speculation
      • trade between developing countries
        • trade blocs of developing countries