The objective of the International Trade subject is to analyze the two main causes of international trade: comparative advantage and the existence of economies of scale in production. The comparative advantage between countries can come from the difference in labor productivity, in the endowments of productive resources and in the proportion in which the productive factors are used in the different economic sectors.

The first three topics analyze the role of comparative advantage in the origin of international trade as well as the gains from trade and the effect that trade has on the distribution of income in each country. Topic 4 presents a standard model that generalizes the models analyzed in the previous topics, which is then used to analyze the effect of different international trade policies. Topic 5 analyzes international trade based on the existence of economies of scale. Finally, topic 6 deals with export decisions, outsourcing and multinational companies.

To take this course it is advisable to have assimilated the knowledge of the subjects Mathematics I, Mathematics II, Microeconomics and Intermediate Microeconomics since they provide the necessary analytical tools.

International trade is an optional subject in the second semester that can be taken in the third or fourth year. It is a subject in which some of the microeconomic contents of consumer and producer theory taught in the Microeconomics and Intermediate Microeconomics subjects of the second year of the Economics Degree are applied to an international context.

The subject of International Trade provides the future graduate with tools to understand the trade flows observed in reality, which may be useful in the performance of his or her professional activity.

OBJECTIVES



To study the different theoretical models of international trade analyzing the role of labor productivity, specific factors of production and differences in relative factor endowments. To study the gains from free trade and their effect on income distribution, as well as the role of economies of scale.



COMPETENCIES

Specific competences of the subject



C1. Model and express graphically and mathematically the economic aspects related to the causes and consequences of international trade.

C2. Understand and explain how international trade is generated through comparative advantage and resource differences.

C3. Analyze the effects of international trade on income distribution.

C4. Recognize the effect of economies of scale in international trade, differentiating between intra-industry trade and inter-industry trade.

Cross-cutting competencies



T1. Search, analyze and synthesize information from diverse sources.

T2. Develop the ability to prepare clear and coherent reports.

T3. Develop the learning skills to acquire a high degree of autonomy in their own self-training.



Learning outcomes



1.- To know how to determine the pattern of trade based on the comparative advantage of a country, when such advantage is due to the difference in labor productivity. This implies knowing how to obtain the world relative supply function of a good, given the marginal productivity of labor in each sector in the different countries.

2.- To know how to determine the pattern of trade based on the comparative advantage of a country, when this advantage comes from the difference in the endowment of productive resources and the technology used. This implies knowing how to situate the relative world supply in relation to the relative supplies of countries in autarky to determine the relative price of goods in equilibrium.

3.- Ability to calculate the profits obtained by countries when trading, as well as to know how to determine the effect that international trade has on the distribution of income within each country.

4.- To know how to formalize the results and interpret them in economic terms, as well as to carry out an analysis of comparative statics in order to study the effects that changes in the relevant economic variables have on such results.

5.- Ability to identify, analyze and model the economic aspects related to economies of scale as a cause of international trade.

Topic 1: Labor productivity and comparative advantage: the Ricardian model.

Topic 2: Specific factors and income distribution.

Topic 3: Resources and trade: the Heckscher-Ohlin model.

Topic 4: The standard trade model.

Topic 5: Economies of scale, imperfect competition and international trade.

Topic 6: External economies of scale and international location of production.

The teaching of the course has as a central element the master class, in which the various topics that make up the program of the course will be developed, focusing on the theoretical content of the same. In the practical classes, exercises and numerical problems will be carried out to illustrate the theoretical knowledge. In the seminars the students will solve individually and in groups numerical problems related to the topics analyzed in the lectures and practical classes.

The teaching of the course reserves the right to modify both the teaching methodology and the evaluation described in the following sections, if the teaching and/or evaluation in the classroom are not possible due to unforeseen circumstances.

• Continuous Assessment System
• Final Assessment System
• Tools and qualification percentages:
  • Written test to be taken (%): 33
  • Realization of Practical Work (exercises, cases or problems) (%): 33
  • Team projects (problem solving, project design)) (%): 33
  • Otros (%): 1

The evaluation will be continuous. There will be several tests whose dates and weights will be specified at the beginning of the course. It will be necessary to pass each subject in order to remain in the continuous evaluation. The work done will be evaluated and will account for 100% of the grade.



For those students who do not participate in the continuous evaluation, as long as the test can be face-to-face, the evaluation will be carried out by means of a final exam that will represent 100% of the final grade. In case the test cannot be in person, the evaluation will be carried out by means of the resolution of a personalized collection of exercises to be handed in within two days of its reception, which will represent 100% of the final grade.

In case of using the continuous evaluation system, students may waive the call within a period that, at least, will be up to one month before the end date of the teaching period of the corresponding subject. This waiver must be submitted in writing to the faculty responsible for the subject. The waiver will result in the grade of not presented or not presented.

Whenever the test can be face-to-face, the evaluation will be carried out by means of a final exam that will represent 100% of the final grade. In case the test cannot be in person, the evaluation will be carried out by means of the resolution of a personalized collection of exercises to be handed in within two days of its reception, which will represent 100% of the final grade.

Basic bibliography

Krugman P.,Obstfeld M. y Melitz M. "Economía Internacional. Teoría y política, 9ª edición, 2012,Pearson Educación S.A.

In-depth bibliography

Feenstra C. y Taylor A. "Comercio internacional", 2011, Editorial Reverté, S.A.

Journals

http://www.revistasice.com/

Web addresses

http://conten.pearson.es
http://www.ehu.es/servicios/CDE
http://www.europarl.europa.es/
http://www.wto.org/