International Economics: Payments, Exchange Rates and Macro Policy

The world of international economics - early trade theories; the classical world of David Ricardo and comparative advantage; extensions and tests of the classical mode of trade; introduction to neoclassical trade theory; gains from trade in neoclassical theory; offer curves and the terms of trade; the basis for trade; empirical tests of the Heckscher-Ohlin theorem; alternative theories of trade and intra-industry trade; economic growth and international trade; international factor movements; the instruments of trade policy; the impact of trade policy; traditional arguments for protectionism; "New Protectionist" approaches to trade policy intervention; review of recent US trade policy; economic integration; international trade and the developing countries; the balance of payments accounts; the foreign exchange market; the instruments of international finance; the monetary portfolio balance approaches to external balance; current account adjustments to balance of payments disequilibrium - price effects; current account adjustments to balance of payments disequilibrium - income effects; economic policy in the open economy - fixed exchange rates; economic policy in the open economy - flexible exchange rates; price and output in the open economy - aggregate supply and demand; fixed or flexible exchange rates; the international monetary system.