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Jason Abrevaya, Chair 2225 Speedway, Stop C3100, Austin, TX 78712 • 512-471-3211

Fall 2009

ECO 339K • International Trade and Investment

Unique Days Time Location Instructor

Course Description

This course will analyze the causes and consequences of international trade and investment, and provide an introduction to the models and data economists use to address these questions. We will investigate why nations trade, what they trade, and who gains from this trade. We will analyze the motives for governments to regulate international trade, and study the effects of such policies on economic welfare, international trade agreements, and some current trade policy disputes. We will then go to the "international investment" part of the course, and study how exchange rates, interest rates, and price levels are determined in an open economy, as well as possible causes of current account deficits and surpluses. We will study how international transactions are recorded in the Balance of Payment of a country. We will spend some time discussing aspects of the current debate on globalization, such as the effects of trade on wages, economic growth and income distribution; multinational firms, foreign direct investment, and outsourcing; the financial crises of the nineties; the use of international labor standards; the interactions between trade and environmental concerns. We will rely on formal economic modeling to help us understand past and current events in the world economy. We will therefore extensively use microeconomics tools that you have learned in previous courses. It is very important that you be familiar with these tools, and feel comfortable using and manipulating them. If you are taking this class, it will be assumed that this is the case. If more information is needed contact instructor.


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