International economics

E INDICES 1. Trade Complementarity Index The trade complementarity (TC) index provides significant information on opportunities for intraregional trade. It shows how well the structures of a country’s imports and exports match. It also has the feature that its values for countries considering the formation of a re-gional trade agreement can be compared with others that have formed or tried to form similar arrangements. Where xij is the share of good i in global exports of country j and mik…

Introduction Donald Trump advised that the globalization destroyed the US economy. Globalization is disruptive and unfair against the global competitive market. Some exporting countries like China, take advantages of globalization, free trade and financial flows. Millions of workers in the US are unemployed and under poverty due to the negative impact of globalization to the US. Trump has acted to tackle the problems derived from globalization. He announced policies including preventing U.S…

Case study Bharat forge and Suzlon are two major Indian companies which have put India in the world market. It is mainly focused on entering the global market. These two companies are manufacturers of entirely different products. Bharat forge is a main player in the automotive industry and Suzlon is a textile manufacturing industry. Both the companies started with a basic this case study highlights the key points on how both the companies used strategies and resources to enter and establish in…

The Ricardian model is a classical theory that says comparative advantage which comes as a result of differences in technologies across countries is what determines the pattern of trade. Hecksher-Ohlin’s model on the other hand says, trade comes as a result of differences in resource endowment in each country. The objective of this essay is therefore to compare and contrast the classical (Ricardian model) and Heckscher-Ohlin (HO) model of the commodity composition of trade and discuss the…

1.0. Market Entry Strategy 1.1. Theory According to the resources-based view (RBV), every entry mode plays a significant role for multinational corporations (MNCs) in order to enter the foreign markets with the intention of making use of the capabilities or resources in the host country (Ekeledo & Sivakumar, 2004). Foreign Direct Investment (FDI) involves Wholly Owned Subsidiary (Greenfield and Acquisition) and Joint Venture (minority, 50%/50%, and majority) (Bitzenis, 2012).…

trade is by and large directed by the differences in resources or to state it differently, the existence of differences in economies’ resources is the cornerstone of international trade. It is important to highlight that Heckscher-Ohlin theory does not contradict the Ricardian one which is built on the assumption that international trade is based on differences in comparative costs. Actually, Heckscher-Ohlin theory tries to explain what causes…

What does Bentley mean by cross-cultural history? Cross cultural history is the history of the interactions which different cultures have one each other. These interactions can be on an economic basis in the form trade as they exchange goods. There are cultural exchanges as different societies come in contact with one another. This contact can result in traditions, beliefs etc being carried to areas not originally from as the influence of the society spreads with he people. This is how many…

According to the doctrine of Adam Smith, free trade is to best policy between two nations in the case of that trade between two countries is based on an absolute advantage. When one country is more efficient in producing one commodity but is less efficient in producing another commodity than other country, the gains from trade will be achieved for both countries through specializing in in the production of the commodity which has an absolute advantage, and exchange with other country for the…

How important were economic factors in determining US foreign policy in1890? There were many economic issues, which contributed to the determining of US foreign policy, some were very important than others. There were also many planned, religious and government policy issues. They affected the USAs foreign policy. Foreign policy is the way a certain country contracts with other countries. It can be pretentious by domestic thoughts and the behavior of other states. America increased effect over…

purpose of the international trade game, performed in class, was to teach that trade is essential for many countries to survive. In certain countries, one resource may be scarce while another is of abundance. In order to balance out this dispersion of resources trade occurs between countries. This process even takes place within the countries, transactions between consumers and producers face trade offs of their supplies. Without it, each side will eventually collapse. In the international trade…