UNIVERSITY OF CALIFORNIA Berkeley Department of

Economic
ECONOMICS C181 Syllabus
International Trade (Fall 2013)
Instructor Asrat Tesfayesus E-mail tesfayes@berkeley.edu
Office Evans 67
Class
Sessions
TuT! 1"#$%&"'M
Office
Hours
(ednesdays 1&$'M Location A1 )earst Anne*
SIs! S+,-n .alle s/alle@e0-n.berkeley.edu
Section! " 2-3#"$ E%ans &' " 3-(#"$ E%ans )*' OHs! " 10+"-12#"$ E%ans &3&
Sand+le )lats!1ay- sand+le.e0-n181@/,a+l.0-,
Section! T ,--+"$ ./inelle 22,' T --10+"$ Leconte 3,*' OHs! T 10+"-12#"
2e 3(endy4 5+n 6+ny%7@/,a+l.0-,
Section! " --10"$ E%ans *' " 10-11+"$ E%ans ,*' OHs! T 10+"-12#"$ E%ans *(2
Head SI! Al+sa Ta8!+td+n-va ata8!+td@berkeley.edu
9--, C!an/e#
+1 Hearst +nne0
Te*t 39e:u+red4#
#aul 1ru2man$ "aurice O3stfeld$ "ar4 "elit5
International Economics! T6eor7 8 #olic7
#rentice Hall$ -
t6
Edition 2013
;es0r+<t+-n#
T6is course co%ers 3asic international trade t6eor7 and introduces its 9olic7 im9lications:
International trade 6as 6istoricall7 3een a salient factor in international relations and economic
2ro/t6: "ore recentl7$ since after ;;II$ multilateral trade ne2otiations and a2reements 6a%e
su3stantiall7 li3erali5ed international trade: <nder t6e aus9ices of t6e eneral +2reement on
Tariffs and Trade (+TT) and$ since 1--*$ t6e ;orld Trade Or2ani5ation (;TO) se%eral nations
6a%e entered in numerous a2reements to facilitate and furt6er rea9 t6e 3enefits of international
trade: Furt6ermore$ an e09onentiall7 increasin2 num3er of re2ional a2reements si2nificantl7
contri3ute to t6e increase in international trade flo/: Simultaneousl7$ outside of t6e economics
field$ t6ere is a continued rise of criticism and ne2ati%e sentiment a2ainst international trade and
2lo3ali5ation: T6is course 9ro%ides t6e t6eoretical 3asis to anal7ticall7 e%aluate t6e 2ains from
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UNIVERSITY OF CALIFORNIA Berkeley Department of
Economic
trade and t6e international trade discourse on t6e su3=ect as /ell as to a99reciate t6eir 9olic7
im9lications:
.-als#
+s 9art of >er4ele7?s <nder2raduate Student Learnin2 Initiati%e (<SLI)$ t6e Economics
.e9artment 6as de%elo9ed learnin2 2oals for t6e Economics ma=or:
See 6tt9!@@emla3:3er4ele7:edu@econ@u2rad@u2radA2oals:s6tml
T6e s9ecific learnin2 2oals for t6is course include!
1: >ein2 a3le to a99l7 economic anal7sis to e%aluate s9ecific 9olic7 9ro9osals:
2: >ein2 a3le to com9are t/o or more ar2uments t6at 6a%e different conclusions to a s9ecific
issue or 9ro3lem:
3: <nderstandin2 t6e role of assum9tions in ar2uments:
(: Sol%in2 9ro3lems t6at 6a%e clear solutions:
*: #ro9osin2 solutions to 9ro3lems t6at do not 6a%e clear ans/ers:
&: ;it6in international economics$ 3ein2 a3le to de%elo9 dee9er critical and Buantitati%e t6in4in2
s4ills and a99l7 9ro3lem-sol%in2 s4ills to com9le0 9ro3lems:
): >ein2 a3le to communicate effecti%el7 in /ritten$ s9o4en$ and 2ra96ical form a3out s9ecific
economic issues:
,: <nderstandin2 and e%aluatin2 current economic e%ents and ne/ economic ideas:
9es<-ns+b+l+t+es#
1: +s t6e teac6er$ m7 res9onsi3ilities are to come to class 9re9ared to teac6' to or2ani5e and
9resent t6e material in a manner t6at facilitates 7our learnin2' to res9ond to and encoura2e
Buestions' to o%ersee 2radin2 of assi2nments' to 3e a%aila3le durin2 office 6ours and for
sc6eduled a99ointments$ and to stimulate an ent6usiasm for economics and for learnin2:
2: +s a student$ 7our res9onsi3ilities are to come to class 9re9ared to learn and to 9artici9ate in
lectures and discussions' to com9lete t6e assi2ned readin2s 3efore class (allo/in2 time to re-
read difficult material)' to com9lete 9ro3lem set assi2nments on time' and to ta4e 2 midterm
e0ams as /ell as a final:
3: Cou are also res9onsi3le for com9l7in2 /it6 t6e >er4ele7 Cam9us Code of Student Conduct:
T6is Code reBuires eac6 student to act /it6 inte2rit7 in all academic acti%ities and to 6old 6is or
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UNIVERSITY OF CALIFORNIA Berkeley Department of
Economic
6er 9eers to t6e same standard: L7in2$ c6eatin2$ or 9la2iarism of 9u3lis6ed /or4$ /or4 9osted on
t6e Internet$ or /or4 done 37 9rofessors or ot6er students /ill NOT 3e tolerated:
T!e student 0-,,un+ty at =C >erkeley !as ad-<ted t!e f-ll-1+n/ )-n-r C-de# D+s a
mem3er of t6e <C >er4ele7 communit7$ I act /it6 6onest7$ inte2rit7$ and res9ect for ot6ers:D T6e
6o9e and e09ectation is t6at 7ou /ill ad6ere to t6is code:
(: +ctions t6at 6a%e ne2ati%e effects on ot6ers /ill not 3e tolerated in t6e classroom: If 7ou must
arri%e late or lea%e earl7$ 7ou must do so as Buietl7 as 9ossi3le: In consideration of 7our fello/
students and t6e instructor$ 9lease refrain from tal4in2 /it6 7our nei263ors durin2 class: Eo cell
96ones s6ould 3e audi3le durin2 class sessions:
9es-ur0es#
;e /ill use 3S9ace as our course /e3site: T6e site /ill include t6is s7lla3us$ lecture slides$
additional readin2 assi2nments (if an7)$ 9ro3lem set assi2nments$ and ot6er information rele%ant
to t6e class:
Evaluat+-n#
T6ere are four (() sets of 2raded assi2nments durin2 t6e semester /it6 t6e follo/in2 /ei26ts and
due dates:
#ro3lem Sets! 1&F Garious .ue .ates (See >elo/):
"idterm 1! 2*F Octo3er 3
rd
2013:
"idterm 2! 2*F Eo%em3er *
t6
2013:
Final E0am! 3(F .ecem3er 20
t6
2013:
E0tra Credit! <9 to *F Octo3er 1*
t6
2013:
Cour 9ro3lem sets and e0ams /ill 3e 2raded 37 7our SIs: Cour ans/ers are 2raded solel7 on
t6eir content and not on t6eir intent: T6is means t6at /e donHt 2rade /6at 7ou Imeant to sa7J 3ut
/6at 7ou actuall7 /rite$ e%en if 7ou I4ne/ t6e ans/er 3ut =ust couldnHt sa7 it ri26t:J T6is also
means t6at ans/ers t6at are ille2i3le$ ram3lin2$ or 9oorl7 or2ani5ed /ill not recei%e 6i26 scores:
C-de -f Et!+0s?Test Aff+r,at+-n#
In concert /it6 t6e >er4ele7 Cam9us Code of Student Conduct$ academic dis6onest7 /ill not 3e
tolerated:
+cademic dis6onest7 is Iall forms of academic misconduct includin2 3ut not limited to c6eatin2$
fa3rication$ 9la2iarism$ or facilitatin2 academic dis6onest7:J +n7 e%idence of c6eatin2 /ill result in
a score of 5ero (0) on t6at assi2nment or e0am: C6eatin2 on t6e final e0am /ill result in an IFJ for
t6e course: Incidences of c6eatin2 /ill also 3e re9orted to Student Kudicial +ffairs$ /6ic6 ma7
administer additional 9unis6ment:
C6eatin2 includes 3ut is not limited to 3rin2in2 notes or /ritten or electronic materials into an
e0am$ usin2 notes or /ritten or electronic materials durin2 an e0am$ co97in2 or editin2 off anot6er
9ersonHs assi2nment$ co97in2 off anot6er 9ersonHs e0am$ allo/in2 someone to co97 off of 7our
assi2nment or e0am$ and 6a%in2 someone else do an assi2nment or ta4e an e0am for 7ou:
#a2e 3
UNIVERSITY OF CALIFORNIA Berkeley Department of
Economic
'r-ble, Sets#
T6ere are ( 9ro3lem sets of /6ic6 /ill all count to/ard 7our final course 2rade:
#ro3lem set solutions are due at t6e >EIEEIE of class on t6e due date:
1: #ro3lem sets M=ST 6a%e 7our name (last name first) and SI. num3er in t6e u99er ri26t 6and
corner:
2: Late 9ro3lem sets /ill NOT 3e acce9ted:
Alt!-u/! y-u ,ay 1-rk -n <r-ble, sets 1+t! y-ur 0lass,ates@ t!e ans1ers 1!+0! y-u
!and +n are e*<e0ted t- be y-ur -1n eff-rt.
raded 9ro3lem sets /ill 3e returned in section: 'r-ble, set s0-res 1+ll be <-sted -n bs<a0e.
It +s y-ur res<-ns+b+l+ty t- +nsure t!at t!ey are 0-rre0t. Any d+s0re<an0+es s!-uld be
re<-rted t- y-ur .SI +,,ed+ately.
E*a,s#
"idterm 1 is sc6eduled for T6ursda7$ Octo3er 3
rd
2013 in class:
"idterm 2 is sc6eduled for Tuesda7$ Eo%em3er *
t6
2013 in class:
Final is sc6eduled for Frida7$ .ecem3er 20
t6
2013 in class:
If y-u !ave -r ant+0+<ate a 0-nfl+0t 1+t! t!e f+nal e*a, s0!edule@ y-u s!-uld ;9O' t!+s
0-urse n-1 and retake +t +n an-t!er se,ester. Conflicts include ot6er e0ams$ nonrefunda3le
airline tic4ets$ /eddin2s$ and ot6er commitments t6at reBuire 7ou to lea%e cam9us 3efore +u2ust
,t6: Eac6 e0am /ill co%er t6e materials assi2ned for t6at section$ t6rou26 and includin2 t6e
lecture 3efore t6e e0am:
E0ams /ill 3e closed 3oo4 and closed notes and are to 3e done /it6out an7 outside 6el9: Eo
calculators$ la9to9s$ 3ee9ers$ cell 96ones$ ot6er electronic de%ices$ or Ic6eat s6eetsJ are allo/ed
durin2 e0ams: Cou s6ould not 3rin2 scratc6 9a9er into e0ams' it /ill 3e 9ro%ided: Ho/e%er$ y-u
1+ll need a set -f 0-l-r <ens -r <en0+ls:
T6ere s6ould 3e no communications 3et/een students durin2 e0ams$ eit6er one /a7 (9ee4in2 at
or co97in2 someone elseHs /or4) or t/o /a7s (s6arin2 ans/ers /it6 or 6el9in2 out anot6er
student):
T6ere are no sc6eduled ma4e-u9 e0ams: Students /6o miss an e0am for an7 reason must
communicate /it6 me 37 email or 96one no later t6an t6e start of t6e e0am: Cou /ill need to
9ro%ide %alid medical and@or le2al documentation e09lainin2 /67 7ou /ere una3le to ta4e t6e
e0am on sc6edule: E0ce9t under t6e most e0treme circumstances$ if 7ou do not 6a%e an e0cused
a3sence bef-re t6e e0am starts and 7ou do not ta4e t6e e0am$ 7ou /ill recei%e a 5ero (0) on t6e
e0am:
raded e0ams /ill 3e returned in class: E*a, s0-res 1+ll be <-sted -n bS<a0e. It +s y-ur
res<-ns+b+l+ty t- +nsure t!at t!ey are 0-rre0t. Any d+s0re<an0+es s!-uld be re<-rted t- t!e
reader +,,ed+ately.
9e&/rade 9e:uests#
T6e SIs ta4e 2reat care in 2radin2 e0ams: Ho/e%er$ if 7ou 3elie%e t6ere 6as 3een an arit6metic
error in addin2 u9 t6e 9oints on 7our e0am$ sim9l7 9oint t6is out to 7our SI /6en 7ou recei%e
7our e0am 3ac4 and it /ill 3e corrected: If 7ou 3elie%e t6at t6ere 6as 3een an error in t6e
GRADING of 7our e0am$ 6ere are t6e ste9s 7ou must follo/:
#a2e (
UNIVERSITY OF CALIFORNIA Berkeley Department of
Economic
1: ;it6in ) da7s of t6e time t6at e0ams are first returned in lecture$ 2i%e me 7our e0am and a
/ritten (i:e:$ /ord 9rocessed) reBuest of /6at Buestion(s) 7ou t6in4 s6ould 3e re-2raded and an
e09lanation of /67: .o not c6an2e t6e ans/ers on 7our e0am' t79e out 7our reBuest se9aratel7
and 2i%e 3ot6 7our reBuest and 7our ori2inal e0am to me:
2: T6e SI reser%es t6e ri26t to re-2rade 7our entire e0am$ not =ust t6e Buestion(s) mentioned in
7our re-2rade reBuest: Scores on an7 Buestion can 3e c6an2edLincreased or decreased:
T6erefore$ it is 9ossi3le t6at 7ou could /ind u9 /it6 fe/er 9oints at t6e end of t6e re-2rade t6an
7ou 6ad ori2inall7:
3: I /ill ad%ise t6e SIs to re=ect an7 re-2rade reBuest t6at is for onl7 3 9oints or less: It is sim9l7
not a 2ood use of an7oneHs time:
E0ams are not =ust assessment tools$ t6e7 are also learnin2 tools: I 6o9e 7ou /ill learn from t6e
e0ams:
Cou are /elcome to tal4 /it6 me a3out /6at conce9ts 7ou missed or /ere confused on so t6at
/e can 6el9 7ou 3e clear on t6e material: Kust remem3er t6at t6e reason for t6e con%ersation is
not a3out c6an2in2 9oints$ itHs a3out 6el9in2 7ou understand t6e material:
;S' E*a, A00-,,-dat+-ns#
If y-u are ent+tled t- s<e0+al a00-,,-dat+-ns -n e*a,s y-u M=ST ,ake an a<<-+nt,ent
t- s<eak 1+t! ,e n- later t!an Se<te,ber
t!
"%1$. Cou /ill e%entuall7 need to 9ro%ide an
e%aluation form from t6e .isa3led StudentsH #ro2ram office:
C-urse Aetter .rades#
2-ur 0-urse letter /rade 1+ll be deter,+ned s-lely fr-, t!e 1e+/!ted avera/e <er0enta/e
-f y-ur /raded ass+/n,ents.
M T6e four (() scores on 7our ( 9ro3lem sets /ill count for 1&F of 7our final 2rade (i:e: (F eac6):
M T6e "idterms /ill count for 2*F of 7our final 2rade eac6:
M T6e Final /ill count for 3(F of 7our final 2rade:
M T6ere are no alternati%e /ei26tin2s of 2raded assi2nments:
#oints earned on eac6 2raded assi2nment are con%erted to 9ercenta2es: Eac6 2raded
assi2nment 9ercenta2e is t6en /ei26ted 37 t6e /ei26t for t6at assi2nment:
T6ere is no fi0ed cur%e for t6is course dictatin2 /6at s6are of students /ill recei%e /6at letter
2rade: It is t6eoreticall7 9ossi3le for e%er7one to earn an +: It is eBuall7 9ossi3le for e%er7one to
earn a C: #ast 9erformance of students in Economics 1,1 classes indicates t6at a99ro0imatel7
2*F of t6e class /ill recei%e some sort of +$ a3out (0F /ill recei%e some sort of >$ and t6e
remainder /ill recei%e some sort of C or 3elo/:
Students ta4in2 t6e course under t6e #@E# o9tion must earn at least a C- in order to 9ass t6e
course:
#lease note t6at if 7ou are fulfillin2 a reBuirement for t6e economics or 3usiness administration
ma=ors$ 7ou cannot ta4e t6is course #@E#:
#a2e *
UNIVERSITY OF CALIFORNIA Berkeley Department of
Economic
Cour score on t6e final e0am and 7our course letter 2rade /ill 3e 9osted on 3s9ace as soon as
t6e7 are determined:
C-urse S0!edule#
9ead+n/@ 'r-ble, Set@ and E*a, S0!edule!
T6e sc6edule for readin2s$ 9ro3lem sets$ and e0ams is 2i%en 3elo/: T6e material /e co%er is
sometimes difficult and /e co%er it fairl7 Buic4l7 so it is ad%isa3le t6at 7ou come to eac6 class
9re9ared: T6e material co%ered assumes t6at 7ou are comforta3le /it6 intermediate
microeconomics: T6e tec6niBues /e /ill use are 9rimaril7 2eometric$ alt6ou26 some al2e3ra /ill
a99ear at 9oints in t6e course:
+dditional 6andouts concernin2 current a99lications of international trade t6eor7 and 9olic7 ma7
3e assi2ned and discussed as /ell: Cou are res9onsi3le for +LL assi2ned materials: Lectures /ill
2enerall7 follo/ t6e te0t3oo4 3ut EOT co%er all of t6e material: In addition$ I ;ILL add lecture
material t6at is not in t6e te0t3oo4: Cou s6ould also read t6e 3usiness section of a ma=or
ne/s9a9er and@or /ee4l7 9eriodical to sta7 a3reast of current international economic issues:
9ead+n/@ 'r-ble, Set@ and E*a, S0!edule
+u2ust 2-$ 2013 (T6ursda7) Introduction to International Trade$ C6a9ter 1:
Se9tem3er 3$ 2013 (Tuesda7) ;orld Trade! +n O%er%ie/$ C6a9ter 2:
T6e Nicardian "odel$ C6a9ter 3:
Se9tem3er *$ 2013 (T6ursda7) T6e Nicardian "odel$ C6a9ter 3:
Se9tem3er 10$ 2013 (Tuesda7) T6e Hec4sc6er-O6lin "odel$ C6a9ter *:
Se9tem3er 12$ 2013 (T6ursda7) T6e Hec4sc6er-O6lin "odel$ C6a9ter *:
Se9tem3er 1)$ 2013 (Tuesda7) T6e S9ecific Factors "odel$ C6a9ter (:
Se9tem3er 1-$ 2013 (T6ursda7) T6e S9ecific Factors "odel$ C6a9ter (:
'r-ble, Set B1 due.
Se9tem3er 2($ 2013 (Tuesda7) T6e Standard Trade "odel$ C6a9ter &:
Se9tem3er 2&$ 2013 (T6ursda7) T6e Standard Trade "odel$ C6a9ter &:
Octo3er 1$ 2013 (Tuesda7) Ne%ie/:
Octo3er 3$ 2013 (T6ursda7) E*a, 1:
Octo3er ,$ 2013 (T6ursda7) Firms in t6e lo3al Econom7$ C6a9ter ,:
Octo3er 10$ 2013 (T6ursda7) Firms in t6e lo3al Econom7$ C6a9ter ,:
Octo3er 1*$ 2013 (Tuesda7) E0ternal Economies of Scale$ C6a9ter ):
Octo3er 1)$ 2013 (T6ursda7) T6e Instruments of Trade #olic7$ C6a9ter -:
'r-ble, Set B" due.
Octo3er 22$ 2013 (Tuesda7) T6e Instruments of Trade #olic7$ C6a9ter -:
Octo3er 2($ 2013 (T6ursda7) T6e #olitical Econom7 of Trade #olic7$ C6a9ter 10:
Octo3er 2-$ 2013 (Tuesda7) T6e #olitical Econom7 of Trade #olic7$ C6a9ter 10:
Octo3er 31$ 2013 (T6ursda7) T6e Instruments of Trade #olic7$ C6a9ter -:
#a2e &
UNIVERSITY OF CALIFORNIA Berkeley Department of
Economic
Eo%em3er *$ 2013 (Tuesda7) E*a, ".
Eo%em3er )$ 2013 (T6ursda7) Contro%ersies in Trade #olic7$ C6a9ter 12:
Eo%em3er 12$ 2013(Tuesda7) Trade #olic7 in .e%elo9in2 Countries$ C6a9ter 11:
'r-ble, Set B $ due.
Eo%em3er 1($ 2013 (T6ursda7) Trade #olic7 in .e%elo9in2 Countries$ C6a9ter 11:
Eo%em3er 1-$ 2013 (Tuesda7) T6e #olitical Econom7 of Trade #olic7$ C6a9ter 10:
Eo%em3er 21$ 2013 (T6ursda7) Contro%ersies in Trade #olic7$ C6a9ter 12:
Eo%em3er 2&$ 2013 (Tuesda7) Contro%ersies in Trade #olic7$ C6a9ter 12:
Eo%em3er 2,$ 2013 (T6ursda7) N- Class 3)a<<y T!anks/+v+n/4.
.ecem3er 3$ 2013 (Tuesda7) T6e #resent State of International Trade #olic7$ C6a9ter
12:
'r-ble, Set B 7 due.
.ecem3er *$ 2013 (T6ursda7) Summar7 and Conclusions@Course E%aluations@Final
E0am Ne%ie/
.ecem3er 20$ 2013 (Frida7) CINAA EDAM@ 8&11AM.
#a2e )