Você está na página 1de 7

Course Syllabus

IMS 5200
Global Economy
Summer 2006

Instructor: Dr. Habte Woldu


Phone: (972) 883-6357
E-mail: wolduh@utdallas.edu
Office: SM.4.805
Office hours: T, R & F 4:45:-6:00

Course Description:
The course deals with economic relations in a global economy characterized by
increasing interdependence of nations. Students through the foundations of neoclassic
and contemporary economic theories will learn about absolute and comparative
advantage of nations in international trade. The course also introduces new theories of
international trade that have relevance in the current global economic situation. Students
through various graphs will be able to see the impacts of trade barriers and protectionist
government policies on the economic welfare of nations. Furthermore, students in this
course will learn about the challenges of globalization such as environmental questions,
child labor by multinational firms, the unfair terms of trade and the clash between
multinational firms and developing countries on employment, transfer pricing and
investment policies. In addition, students through group research and case reports will
present their findings to the class.

Required Text:

Carbaugh, Robert, International Economics, 10 Special Edition, South-Western, 2006.

Recommended readings:

Yergin, D. and Stanislaw, J., Commanding Heights: The Battle for the World Economy,
PBS Series, 2002
The Economist, Wall Street-international section and Journal of International Business
Studies
Course Outline

May 30 Ch 1 an overview of the international economy and globalization

Points of Discussion
• Is international trade a threat or a benefit to workers of every country?
• Explain how the global economy emerged
• Does global competition improve or diminish quality of life?
• Understand why global leadership tends shift from nations to nations

Ch 2 Foundation of modern trade theory and comparative advantage

Points of Discussion
• Based on the story “Cloth Imports from China Threaten Italy’s
Markets” discussed on pp 4-5 in Carbaugh, how serious is the
Chinese competitive threat to Italy’s Textile market? Discuss
• What kind of strategy has the Italian Textile industry adapted in
order, to stay competitive in the global competition
• Is globalization responsible for the spread of terrorism throughout
the World, Carbaugh pp. 21-23?
• As nations become wealthier, the level of their interdependence
increases. Explain why this statement is true. (Apply the level of
interdependence coefficient, (import+export)/GNP, in order to
assess the above assumption.

June 06 Ch 3 Sources of Comparative Advantage

Points of Discussion
• Explain how free trade tends to equalize commodity prices
among trading partners. Explain why some economists doubt
about the universality of such observation.
• Explain why globalization has not equally benefited all
economic sectors and all U.S. citizens. Explain the reasons
behind it by providing evidences.
• Does Factor Endowment Theory explain trade patterns
adequately?
• Discuss why cheap labor may not always guarantee high
investment return for the international firms that are relocating
from economically advanced countries to developing countries.
Sources of information for the above discussion is available in
chapter 3, Carbaugh, p.66
• “The Anxiety behind Globalization and Trade”. Globalization
carries consequences that can generate “winners and losers”.
Explain why this phenomenon is particularly visible in the
“Dual Economy” of modern US economy
Video: Commanding height: challenges and opportunities in
the global market

Ch 4 Trade Model Extensions and Applications

Points of Discussion
• Explain how the factor-endowment theory of trade differs from
the views expressed by Smith and Riccardo
• Does Factor Endowment Theory explain the trade patterns in
the current global economy?
• Discuss why the Theory of Overlapping Demands explains
how trade relationship among nations is shape
• Explain how inter-industry trade develops between countries
o Discuss why California imports French wine and
exports its home produced wine to foreign markets
• Explain how the product cycle determines
• Why do nations want to export by subsidizing their selected
industries?

Case 1: Relative Export and Relative Unit Labor Costs:

Explain how relative exports and relative unit labor costs are
associated. Based on figure 2.8, Carbaugh, can you justify that
U.S Export of various industries to China is associated with the
current U.S-China trade pattern, on the base of unit labor cost
ratio?

Video: The Battle of Ideas: Commanding Heights-The New Rules


of the Game

June 13 Ch 5 Tariffs and the Concept of Tariffs

Points of Discussion
• Identify the types of tariffs
• Should the U.S. apply tariffs on steel imports in order to
protect steel workers
• Understand the nominal and effective tariff rates.
• Explain the effects of tariff on a nation’s economy. What are
the arguments used by opponents free trade in order to justify
import restrictions?
• Explain how the tariff welfare affects small nations. Use the
model on page 113, Carbaugh to explain.
• Learn about concepts of consumer and producer surplus, and
revenue effect of tariff

Case 2: Nike and Reebok Respond to Sweatshop Shop Critics;


but wages remain at poverty Level

Nike and Reebok have been criticized for exploitation of children


and systematic violation of workers’ rights that have been certified
in law. For example, a 1997 audit conducted by Ernest and Young
found, that employees in a large Vietnam factory were exposed to
the fumes of cancer-causing a high incidence of respiratory
problems and were required to work as long as 65 hours a week,
while the competitor of Nike, Reebok applied sex bias, and caused
health problems among worker. On the other, while there is no
justification for exploitation and human right violation of people,
the situation on the ground of many developing countries dictates
the terms under which the laws of economics works. There are
those who argue that the local people, organizations and
governments should be consulted before activities from a third
country/ies. Under such conflicting objectives what kind of
solutions do you seek to solve the underlined problems? (Pp78-79)

Case 3: unfair terms of trade for developing countries

• Given that the price of industrial products compared to agricultural


products rise faster, it is known that the developing countries
which have agriculture-based economy will be unhappy about it,
but as long as the need for industrial products are higher than the
need for agriculture products, it looks that the industrial countries
will continue to exploit the developing countries. What can be
done to minimize the existing tension between the “North” the
international trade? The developing or developed countries?
Who and the “South”? Should a student of global economy worry
about this?

June 20 Ch 7 Trade regulations and industrial policies

Points of Discussion
• Explain how the Japanese voluntary auto export restraint policy
helped the automakers in the U.S.
• Explain how tariff and quota restrictions affect the welfare of a
nation
• Explain the effects of dumped and subsidized import and their
remedies.
Midterm chapters 1-4
27 Ch 8 Trade policies in developing countries

Points of Discussion:
• Who sets the prices of bananas and jet fighters?
• Do you see the importance of a new economic order?
• Is China setting an example for the rest of developing countries?
• Can developing countries follow OPEC’s strategy, in order to keep
the prices of their primary productive competitive?

Case 4: fair-trade movement helps poor coffee: global awareness

Farmers’ Fair-Trade Movement is trying to help the small and poor


coffee farmers by bypassing the traditional middlemen who take
most of the income and selling it directly to the big coffee roasters.
This movement is getting attention from the world coffee drinkers,
however while the movement is getting a strong support in
European countries, the United States is not keen to bring the issue
to its coffee drinkers. What is the significance of such movement
to the global economy? Does it make any difference whether we
drink the coffee directly from its source (the poor small farmers) or
from the middlemen?
Reading assignment: Underreported: Fair Trade Coffee
http://www.wnyc.org/shows/lopate/episodes/11102005

July11 Ch 9 Regional Trading Arrangements

Points of Discussion:

• Who benefits from economic and trading blocs?


• The objectives of regional arrangement for the global economy
• Is regional grouping of countries such that of EU and NAFTA
helpful for the global economy? Source
• What are the challenges EU members face due to the enlargement
of EU as the new member countries, mostly from the former East
European Bloc countries join the old regional association?
• Explain how migration of labor from Mexico to the United States
can be perceived as wage equalizing factor. What barriers do you
see that hamper such a process from happening soon? (chapter 10,
2004)
• What are the challenges of the enlargement of EU? E.g. The
accession of new members, mostly Central and East European
countries?
Case 5: “WTO Rulings Outrage Environmentalists”

While WTO is expected to help the flow of goods and services from
country to country with little trade barriers, environmentalists have been
fighting it very forcefully. As long as the fight between the
environmentalist and the business community continues, WTO will have
supporters and opponents. Discuss how this never ending battle can be
stopped. In other words, is there any golden medium that can satisfy both
sides? (Use the full text available on pp 186-187, Carbaugh, for your
reference).

Video: EU Enlargement: The accession of 11 countries on May 1, 2004

July 18 Ch 10 International factor movements and multinational


enterprise
Points of Discussion:

Points of Discussion:
• The Role of multinational firms
• What triggers multinational firms to expand to a foreign market?
• What are the modes of entry of foreign firms to a foreign market?
• Identify the issues that lead to conflicts between host countries and
multinational firms.
• Do multinational firms have the responsibility of being aware of
societal tensions, environmental issues, racial and gender
inequalities.

Case 6: Does Foreign Direct Investment Hinder or Help Economic


Development?

Many developing countries, in order to have economic growth, need to


increase their national capital stock. This means they (the governments
of developing countries) need to encourage foreign direct investment.
Foreign direct investment can be realized either when foreign firms
locate plants in the domestic economy or acquire substantial
ownership position in a domestic firm. However, many developing
countries have also attempted to restrict foreign direct investment
because of nationalist sentiment and concerns about foreign economic
and political influence. Do you think countries which are more open
for FDI have been economically performing better or worse than those
in-word looking nations? Your presentation of the case should be
based on the arguments presented on p 249 and data observation which
shows the flow of FDI and economic growth of developing countries.

July 25 Final Examination Ch 5-10


Project report Format: you can earn up to a maximum of 15 % for your
paper and project presentation and 5 % for group peer evaluation.

Each student will be given a grade based on the outcome of group project
and his/her level of participation within a group. The group project report
will consist of 5 pages, double-spaced and typed. The report also should
include the bibliography of the sources used in the report; at least five
references excluding your book are required. Even though, the whole
class is expected to read all cases and actively participate in discussion,
the assigned group should play an active role in leading and initiating
discussion. As the end of the group project presentation, the peer
evaluation reports will be collected by the instructor. Peer evaluation is
based on individual’s a) intellectual contribution, b) full participation c)
creative and original ideas submitted to the group, d) resourcefulness and
e) level of communication with group members.

Group case report:


-report paper and
Presentation 20%
Class participation and activities 20%
Midterm 30%
Final exam 30%

Class participation: class participation is highly encouraged in both lecture and


case presentation time. The instructor will take attendance from time to time.
Those who attend classes and who actively participate during discussion sessions
will earn the assigned participation grade accordingly. The instructor reserves the
right not to reward participation points, should a student chooses not to show up
for class or is inactive during class discussions.

Policy on cheating:
Students are expected to be above reproach in all scholastic activities. Students who
engage in scholastic dishonesty are subject to disciplinary penalties, including the
possibility of failure in the course. "Scholastic dishonesty includes but is not limited to
cheating, plagiarism, collusion, and the submission for credit of any work or materials
that are attributable in whole or in part to another person, taking an examination for
another person, any act designed to give unfair advantage

Você também pode gostar