Courses:

International Trade >> Content Detail



Syllabus



Syllabus


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Course Description


In this course we will cover the basic tools to understand what determines the flow of goods across countries, i.e. international trade, and what determines the flow of savings and investments from one country to another, i.e. international finance. We will also cover applications to a number of topics of current interest, including the debate on globalization, free trade agreements, the U.S. current account deficit, the medium run prospects for exchange rates, European integration, and the debate on global financial architecture following the financial crises in East Asia and Argentina.



Prerequisites


The prerequisites for this course are 14.01 Principles of Microeconomics and 14.02 Principles of Macroeconomics.



Textbook


The textbook is:

Amazon logo [KO] Krugman, Paul, and Maurice Obstfeld. International Economics: Theory and Policy. Boston, MA: Addison Wesley, 2008. ISBN: 9781408208076.

Some of the other references are listed in the readings section; some are for your own reading.



Recitations


There will be weekly recitation sections where you may ask questions about the problem sets and review material from lecture. Be prepared to participate in class when called on by the instructor.



Grading



ACTIVITIESPERCENTAGES
Problem sets and class participation34%
Midterm exam (90 minutes)33%
Final exam (90 minutes)33%

Cooperation on problem sets is encouraged. A group of up to 3 students may submit a joint answer to any problem set (i.e. one copy, the names of all persons in the group must appear at the top of each problem set, at the time when it is handed in). An in-class mid-term will be held after lecture 13. A 90-minute final exam will be held during exam week. They will cover the lectures, the readings, the problem sets, and other material handed out or discussed in class up to that time.



Recommended Citation


For any use or distribution of these materials, please cite as follows:

Guido Lorenzoni, course materials for 14.54 International Trade, Fall 2006. MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology. Downloaded on [DD Month YYYY].



Calendar



SES #TOPICSKEY DATES
I. International trade
L1-L3International trade and gains from trade; The Ricardian model
L4-L6The specific factors model and the standard trade modelProblem set 1 due in Ses #L4
L7Globalization and inequality
L8The transfer problemProblem set 2 due
L9-L10Trade policy - Tariffs
L11-L12A case study of trade policyProblem set 3 due in Ses #L12
L13Multinationals - Guest lecture by Pol Antras
Midterm exam
II. Open economy macroeconomics
A. Inter-temporal trade and financial markets
L14-L15Inter-temporal trade and the current account
L16Current account adjustment and real exchange rates (with application to the U.S. current account deficit)
L17-L18The Foreign exchange market and currency speculation
B. Short-run adjustment and crises
L19-L20Money and exchange rates, PPP, and the real exchange rateProblem set 4 due in Ses #L19
L21-L22The Mundell-Fleming model and exchange rate regimesProblem set 5 due in Ses #L22
L23-L25Financial crises and currency crisesProblem set 6 due in Ses #L25
L26Course summary
Final exam

 








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