Download Slide 5-9 內生變數Relative price of cloth, PC/PF Relative quantity of

Chapter 5
The Standard Trade Model
Prepared by Iordanis Petsas
To Accompany
International Economics: Theory and Policy, Sixth Edition
by Paul R. Krugman and Maurice Obstfeld
Chapter Organization
 Introduction
 A Standard Model of a Trading Economy
 Economic Growth:Shifting the RS Curve
 International Transfers of Income: Shifting the RD


Curve
Tariffs and Export Subsidies: Simultaneous Shifts in
RS and RD
Summary
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Slide 5-2
The standard trade model
resources
limit
production
function
PPFH
PPFF
RS
TOT effect
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RD
equilibrium
Slide 5-3
學習經濟模型五步驟
模型目的。
內生變數：決定模型兩軸。
行為法則：畫出模型曲線。
均衡：決定均衡之內生變數。
外生衝擊
• 判斷是否為外生變數改變？
• 判斷此外生變數之改變將影響哪些行為法則？
• 判斷此外生變數之改變造成行為法則何種影響？
Copyright © 2003 Pearson Education, Inc.
Slide 5-4
Introduction
 Previous trade theories have emphasized specific
sources of comparative advantage which give rise to
international trade:
• Differences in labor productivity (Ricardian model)
• Differences in resources (specific factors model and
Heckscher-Ohlin model)
 The standard trade model is a general model of trade
that admits these models as special cases.
Copyright © 2003 Pearson Education, Inc.
Slide 5-5
A Standard Model of a
Trading Economy
 Suppose that the world economy consists of two countries ,
each country produces two goods , food (F) and cloth (C):
Home (which exports cloth)
– Its terms of trade are measured by PC /PF .解釋
– Its quantities of cloth and food produced are QC and QF .
Foreign (which exports food)
– Its terms of trade are measured by PF /PC .
– Its quantities of cloth and food produced are Q*C and Q*F
.
Copyright © 2003 Pearson Education, Inc.
Slide 5-6
A Standard Model of a
Trading Economy
Terms of trade
•The price of the good a country initially
exports divided by the price of the good it
initially imports. 返回
Copyright © 2003 Pearson Education, Inc.
Slide 5-7
學習經濟模型五步驟
模型目的。
內生變數：決定模型兩軸。
內生變數
行為法則：畫出模型曲線。
均衡：決定均衡之內生變數。
外生衝擊
• 判斷是否為外生變數改變？
• 判斷此外生變數之改變將影響哪些行為法則？
• 判斷此外生變數之改變造成行為法則何種影響？
Copyright © 2003 Pearson Education, Inc.
Slide 5-8
內生變數
Relative price
of cloth, PC/PF
Copyright © 2003 Pearson Education, Inc.
Relative quantity
of cloth, QC + Q*C
Q F + Q *F
Slide 5-9
學習經濟模型五步驟
模型目的。
內生變數：決定模型兩軸。
行為法則：畫出模型曲線。
行為法則
均衡：決定均衡之內生變數。
外生衝擊
• 判斷是否為外生變數改變？
• 判斷此外生變數之改變將影響哪些行為法則？
• 判斷此外生變數之改變造成行為法則何種影響？
Copyright © 2003 Pearson Education, Inc.
Slide 5-10
A Standard Model of a
Trading Economy
 Production Possibilities and Relative Supply
• Assumptions of the model:
– Each country produces two goods, food (F) and cloth
(C)
– Each country’s production possibility frontier is a
smooth curve (TT)
• The point on its production possibility frontier at
which an economy actually produces depends on the
price of cloth relative to food, PC /PF.
• Isovalue lines
– Lines along which the market value of output is
constant
Copyright © 2003 Pearson Education, Inc.
Slide 5-11
A Standard Model of a
Trading Economy
Figure 5-1: Relative Prices Determine the Economy’s Output
Food production, QF
Isovalue lines
Q
TT
Cloth production, QC
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Slide 5-12
A Standard Model of a
Trading Economy
Figure 5-2: How an Increase in the Relative Price of Cloth Affects
Relative Supply
Food production, QF
PC
PF
QC
QF
QC
QF
Q1
Q2
VV1(PC/PF)1
TT
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VV2(PC/PF)2
Cloth production, QC
Slide 5-13