国际经济学双语第1章
1.1 Mercantilism
The mercantilists advocated government regulation of trade to promote a favorable trade balance.
If a country could achieve a favorable trade balance, it would receive payments from the rest of the world in the form of gold and silver. Such revenues would contribute to an increase in spending and thus a rise in domestic output and employment.
Two assumptions, within each country:
Labor is the only factor of production and is homogeneous (i.e. of one quality).
The cost or price of a good depends exclusively upon the amount of labor required to produhe U.K has an absolute advantage in cloth production.
Chapter 1 Classical Theories of International Trade
1.1 Mercantilism 1.2 Trade Based on Absolute Advantage: Adam Smith 1.3 Trade Based on Comparative Advantage: David
International Economics
Chapter 1
Classical Theories of International Trade
Chapter 1 Classical Theories of International Trade
1.1 Mercantilism 1.2 Trade Based on Absolute Advantage: Adam Smith 1.3 Trade Based on Comparative Advantage: David
Ricardo 1.4 Comparative Advantage and Opportunity Cost 1.5 Comparative Advantage with More Than Two
Commodities and Countries 1.6 Theory of Reciprocal Demand 1.7 Offer Curve and Terms of Trade
Critics Possible only for short term Assuming static world economy
Chapter 1 Classical Theories of International Trade
1.1 Mercantilism 1.2 Trade Based on Absolute Advantage: Adam Smith 1.3 Trade Based on Comparative Advantage: David
1.2 Trade Based on Absolute Advantage: Adam Smith
With free trade, countries could concentrate their production on the goods they could produce most cheaply and enjoy all the consequent benefits from the labor division.
1.2 Trade Based on Absolute Advantage: Adam Smith
An arithmetic example
A Case of Absolute Advantage
Country
Output per Labor Hour
iPad
Cloth
U.K.
5 sets
20 yards
Cost differences govern the international movement of goods. The concept of cost is founded upon the labor theory of value.
1.2 Trade Based on Absolute Advantage: Adam Smith
Ricardo 1.4 Comparative Advantage and Opportunity Cost 1.5 Comparative Advantage with More Than Two
Ricardo 1.4 Comparative Advantage and Opportunity Cost 1.5 Comparative Advantage with More Than Two
Commodities and Countries 1.6 Theory of Reciprocal Demand 1.7 Offer Curve and Terms of Trade
U.S.
15 sets
10 yards
The U.S. has an absolute advantage in iPad production; its iPad workers' productivity (output per worker hour) is higher than that of the U.K, which leads to lower costs (less labor required to produce a set of iPad).