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29 Cards in this Set
- Front
- Back
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Leontief paradox
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, greatest piece of evidencea gainsed factor-proportions theory, shows the United States exporting more labor intensive goods than capital intensive.
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Factor Price Equalization
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as trade causes prices of goods to converge between countries, this causes the relative prieces of factors to converge also.
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intertemporal trade
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term given for the type of trade that results from financial transactions. It differs because it is trade for a goods today for goods in the future.
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internalization
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why is production in different locations done by the same firm?? tech transfer?
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vertical manufactures
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all parts and goods produced by one firm, reduces horizontal problems
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demand supply relationship
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Home Demand - Home Supply = Foriegn supply - foreign demand
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CEU
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complete economic union
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effects from old regionalism
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trade creation
diversion modification TOT external and internal |
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price settign
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mr = mc monopoly
p = mc |
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Duopoly Cournot
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how much to sell: BRF
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Duopoly Nash
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what price to set: becomes competetive
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market share maitenence
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each sells 50%, stays two monopolies
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Stolpher Samuelson
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An increase in the price of "labor good" will raise the wages relative to the rent and capital's income.
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Rybczynski
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increase in a factor endowment will increase by a greater proportion the output of the good that uses that factor and reduce the other.
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income
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= wage x labor + rent x capital
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Q
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q = P(1+t)
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govt revenue
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R = t PM
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relation x , m , p
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pM = X
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Tarrifs equ
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t = (q - P)/P
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g=1
g=0 g=m |
g = 0 ultraprotect
g = 1 saddam g = m neutral |
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metzler paradox
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if export is elastic, the price will fall as a result of tariff
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net investment position
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how much borrowing form the world overall
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current accounts equ
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C = x - pM + E
C = -F E = dividend payments |
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Financial accounts
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assets sold - assets bought
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why multinational
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1) ownership advantage - widget patent
2) locational advangtage = must be a reason to produce elsewhere 3) internalization: keep inside, avoid losing tech advantage |
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new regionalism 5
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DC/LDC (NAFTA)
LDC's are reformers (communism for mkt) Moderate Liberalization Deep Integration Asymmetrical small |
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trends of trade
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Multiliberalization, Fundamental reforms in E&S, more FDI
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timeline 4
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1) Inside price multilateral policies
special interest groups sacrificed for benefits from trade 2) insides negotiate outsides go to autarky 3) implement liberalization - expands multiliberalization outside reevaulate 4) outside choose reform outside compete for FDI, regionalism is important |
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TOT
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pm/px
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