Download international economics

SYLLABUS: INTERNATIONAL ECONOMICS - ECON-AD 103
Credit Hours: 4
Lectures: This is a 14-week course with two classes (1hr 15 min each) per week
Instructor: Professor Samreen Malik
E-mail: [email protected]
Office hours: Tuesday (2.00 – 5.00) or by appointment.
GAF Information: Charles Soll ([email protected])
Office hours: GAF will announce the office hours at a later date.
REQUIRED TEXT:
Robert C. Feenstra and Alan M. Taylor, “International Economics”, Worth 2008.
OTHER READINGS:
You re highly encouraged to also use the following resources; the Economist, the Financial
Times and the Wall Street Journal; for additional articles and readings.
RECOMMENDED READINGS:
Textbook:
Paul Krugman and Maurice Obstfeld: “International Economics: Theory & Policy”, 8 th
edition, Addison Wesley
NOTE ON COURSE MATERIAL:
The course materials will primarily be based on the Text book (relevant chapters). However,
as you will see in the outline, project report, presentation and participations during the
presentation counts as much as the mid-term exam for the final grade evaluation. The project
will be tested on numerous criterions that reflect your understanding of International
Economics. For more details of the project, see the document for project detail.
PREREQUISITES
The prerequisite for this course at NYUAD are Principles of Microeconomics and Principles
of Macroeconomic. It will also be assumed that students are reasonably familiar with basic
mathematical tools, graphics and simple statistics. No other prior knowledge will be assumed.
COURSE DESCRIPTION
This course is an introduction to international economics. It will introduce students to important
theories in the analysis of international trade and international macroeconomics and finance
which will help students in understanding events in the world economy and related policy
issues. This course consists of two parts: (1) International Trade and (2) International
Macroeconomics and Finance.
In the first part of the course, we will study international trade in goods and services. We will
determine various economic forces that shape patterns of trade. We will investigate why
economies trade, what products they trade, who trades them, at what price and quantities they
trade, and study some of the benefits and costs of trade. In addition, a significant part of the
course will also cover various policies that governments use to shape trade patterns among
countries, and the reasons for implementing such policies.
In the second part of the course, we will study international macroeconomics and finance
which is devoted to the study of large scale economic problems in interdependent economies.
Samreen Malik
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SYLLABUS: INTERNATIONAL ECONOMICS - ECON-AD 103
Specifically, we will study the economic linkages in terms of currencies, trade and capital
flows between different economies. The main issues we study include: Foreign exchange
markets, balance of payments, capital flows, financial crises, as well as the coordination of
monetary and fiscal policies in a global economy.
Note: This class is not aimed to provide practical experience of trading in the financial
industry. You should think of this course as merely a first stepping stone in the field of
finance that will allow you to understand the basics of the financial markets.
ASSESSMENT
The grading will be based on three parts:
Homework exercises
Midterm Exam
Project
20%
40%
40%
Homework exercises:
There will be 4 homework exercises (First three homework will be regular homework while
the fourth one will be the sample midterm), each counting for 5% of the final grade. The due
date for each assignment is provided in the mini schedule section of this document. If you
miss class, you are responsible for finding out about any important announcements in class
and changes in assignments. Failure to attend class is NOT an excuse for turning in
assignments late. Late assignments will not be accepted.
Exams:
There is one midterm (written) exam, which is scheduled on 10th October, 2013. The written
section of the project will be due on the last day of class. There is no final exam for this class.
Exams are closed-book and other aids, including any notes, electronic or paper dictionaries,
should not be used. Cell phones cannot be used as calculators and must be turned off and kept
out of sight during all exams. The mid-term will cover all the material covered prior to the
mid-term exam day.
Project:
A detailed outline of the project with the grading scheme is provided separately. Please refer
to that document for deadlines and general outline of the project.
Grading:
Grades
A
AB+
B
BC+
C
CD
F
Samreen Malik
Marks
95-100
90-94
85-89
80-84
75-79
70-74
65-69
60-64
50-59
Below 50
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SYLLABUS: INTERNATIONAL ECONOMICS - ECON-AD 103
Late Homework and Exam Absence
Late homework will not be accepted under any circumstance. The home works will be online
way in advance and therefore no excuse will be accepted for late home works. You must
check the NYU class for any due dates regularly. However, the due dates are also provided in
the mini schedule.
There is no make-up examination for the midterm. If you cannot make it to the midterm due to
clashes with other class times or exams, you should not take my class. In case you have booked
plane tickets for the Fall break that clashes with the mid-term exam, please do not take this class.
Any requests to reschedule the exam will not be entertained.
Exception: In extreme cases (personal or medical emergencies, in which case the student must
provide a written excuse signed by a doctor, parent, or university official) that presses you to
miss the mid-term exam, a make-up midterm will be provided.
Re-grading
Any homework/exam for which there is a re-grade request must be done within seven days
after I return the exam to you. The request for re-grade must be in writing and attached to the
exam when submitting the exam for a re-grade. The request must include a description of
what the problem is and why you think the exam should be graded differently.
PARTICIPATION AND ATTENDANCE POLICIES
Participation
Students are responsible for attending all class meetings, participating responsibly in class
discussions and completing all class assignments.
Specifically, students should try their best:
i)
to come to class on time
ii)
to refrain from packing up belongings before class ends
iii)
not to make noises that might create a disruption in class (e.g., keep your cell
phone in vibration mode or turn it off)
iv)
to give attention while either instructor or another student is speaking
Code of Conduct
Cheating will be taken very seriously. You are responsible to follow all the relevant policies
by the University or Faculty/Department.
Communication
I will be happy to answer questions on the course material by email. Please indicate the
course name in the subject line. In case, I feel that email is not the best mode to explain your
problem; I will be happy to set a separate appointment so that you may come to discuss the
related questions. Occasionally, I will post some of the questions received—with my
answer—on the course website. Hopefully, this will be an efficient way to disseminate
information. Student identifiers will be removed if I post a question (if you do not want your
question posted, just say so in your email.)
The outline provided is tentative and subject to change at the instructor’s discretion.
Samreen Malik
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SYLLABUS: INTERNATIONAL ECONOMICS - ECON-AD 103
COURSE OUTLINE
(Subject to changes as we go along)
Week
Date
Lecture
Topic
CH
Week 1
27-Aug
Lecture 1
Trade in the Global Economy
1
29-Aug
Lecture 2
Trade and Technology The Ricardian Model (I)
2
3-Sep
Lecture 3
Trade and Technology The Ricardian Model (II)
2
5-Sep
Lecture 4
Gains and Losses from Trade in the Specific-Factors Model
3
10-Sep
Lecture 5
Gains and Losses from Trade in the Specific-Factors Model
3
12-Sep
Lecture 6
Trade and Resources The Heckscher-Ohlin Model
4
17-Sep
Lecture 7
Trade and Resources The Heckscher-Ohlin Model
4
19-Sep
Lecture 8
Movement of Labor and Capital Between Countries
5
24-Sep
Lecture 9
Movement of Labor and Capital Between Countries
5
26-Sep
Lecture 10
Trade Policy under Perfect Competition
8
1-Oct
Lecture 11
Trade Policy under Perfect Competition
8
3-Oct
Lecture 12
Trade Policy under Perfect Competition
8
8-Oct
Lecture 13
Practice exam discussed Mid-term discussion
9
10-Oct
Lecture 14
Mid-term exam
11
22-Oct
Lecture 15
The Global Macroeconomy (Background reading) & Exchange
Rates and the Foreign Exchange Market
24-Oct
Lecture 16
Exchange Rates I The Monetary Approach in the Long Run
12
&
13
14
29-Oct
Lecture 17
Exchange Rates I The Monetary Approach in the Long Run
14
31-Oct
Lecture 18
Exchange Rates II The Asset Approach in the Short Run
15
7-Nov
Lecture 19
Exchange Rates II The Asset Approach in the Short Run
15
12-Nov
Lecture 20
National and International Accounts Income/Wealth/Balance of
Payments
16
14-Nov
Lecture 21
Balance of Payments I Gains from Financial Globalization
17
19-Nov
Lecture 22
Balance of Payments I Gains from Financial Globalization
17
21-Nov
Lecture 23
18
26-Nov
Lecture 24
28-Nov
Lecture 25
Balance of Payment II Output, Exchange Rates, and Macro
Policies
Balance of Payment II Output, Exchange Rates, and Macro
Policies
Presentation 1 and 2
3-Dec
Lecture 26
Presentation 3 and 4
10-Dec
Lecture 27
Presentation 5 and 6
12-Dec
Lecture 28
PROJECT DUE
Week 2
Week 3
Week 4
Week 5
Week 6
Week 7
Week 8
Week 9
Week 10
Week 11
Week 12
Week 13
Week 14
Samreen Malik
18
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SYLLABUS: INTERNATIONAL ECONOMICS - ECON-AD 103
Date
Lecture
Mini Schedule
Assignment/Project
Online/Due
Assignment/Project
Online/Due
(1) Questions to be answered in
International trade course.
8/27/2013
1
(2) Terminology
(3) Some useful measures
(1) Absolute and Comparative
Advantage
(a) Marginal Product of Labor
(3) Production Possibility Frontier
8/29/2013
2
(4) Opportunity cost
(5) Indifference curve
(6) Wages
(7) Comparative Adv. (eg) and
Absolute Adv. (eg.)
(1)International Trade Equilibrium
(a) Production and consumption
9/3/2013
3
(b) World price line
(c )Wages
(d) International pricing
(e) Terms of Trade
(1) What we learnt in Ricardian
Model
(a) Specific Factor Model
(b) Setting
(i) Country
(ii) Input and diminishing returns
9/5/2013
4
(iii) PPF
(iv) Opportunity cost and price
(V) Foreign country
(1) Gains from Trade
(a) Wages
9/10/2013
5
(i) Change in relative prices
Assignment 1
Online (5%)
(ii) Earnings of capital and land
Samreen Malik
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SYLLABUS: INTERNATIONAL ECONOMICS - ECON-AD 103
(1) Setting
(a) PPF
(b)Indifference curve
9/12/2013
6
(2) No-trade equilibrium
(d)Price and Quantity (3) Free trade
equilibrium & Hecksher Ohlin
theorem
(1) Effects of trade on factor price
(2) Stolper Samuelsson Theorem
9/17/2013
7
9/19/2013
8
(3) Leontief Paradox (If time)
Assignment 1 Due
(1) Movement of labor between
countries (2)Movement of capital
between countries
(1) Movement of capital between
countries
9/24/2013
9
(2) Gains from labor and capital
movement
(1) Gains from Trade
(a) Import tariff (small country)
9/26/2013
10
(b) Import tariff (large country)
10/1/2013
11
Assignment 2
Online (5%)
(1) Import quotas (small country)
(2) Introduction to subsidies
(1) Export Subsidy (small and large
country)
10/3/2013
12
(2) Production subsidy
Assignment 2 Due
(3) High Tech Export
10/8/2013
Samreen Malik
13
Solve sample Mid-term
Sample Midterm Online
(5%)
Assignment 3:
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SYLLABUS: INTERNATIONAL ECONOMICS - ECON-AD 103
Sample Midterm
Due
10/10/2013
14
Mid Tem Exam (40%)
(1) Exchange rate essentials
10/22/2013
15
(a) ER practices
(b) Market for Foreign Exchange
(c) Arbitrage and IR
(1)ER and prices in the LR
10/24/2013
16
(2) Money, prices and ER in the LR
Assignment 4
Online (5%)
(3) Monetary Approach
(1) Money, Interest and Prices in LR
10/29/2013
17
(2) Monetary Regime and ER Regime
(1) ER and Interest rates in the short
run: UIP and FX market equilibrium
10/31/2013
11/7/2013
18
19
(2) Interest rates in SR: Money
Market Equilibrium (3) Asset
Approach
(1) A complete theory: Unifying
Monetary and Asset approach
Project Online
Assignment 4 Due
(2) Fixed ER and Trilema
(1) Measuring macro-economic
activity
11/12/2013
11/14/2013
20
21
(2) Income, product and expenditure
(3) Balance of Payment
(1) Limit on how much a country can
borrow (LR Budget constraint)
(2) Consumption smoothing
(1) Gains from efficient investment
11/19/2013
22
(2) Gains from diversification of risk
(1) Demand in the open economy
11/21/2013
23
11/26/2013
24
(2) Goods Mkt. Eq. (3) Good and
Forex Mkt. Equilibrium (4) Money
Mkt. Eq.
(1) Short run: IS-LM-FX Model
(2) Stabilization policy
(3) Evaluation
(if time permits)
Samreen Malik
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SYLLABUS: INTERNATIONAL ECONOMICS - ECON-AD 103
11/28/2013
25
Presentation 1 and 2 (10%)
Attendance and Class
Participation (5%)
12/3/2013
26
Presentation 3 and 4 (10%)
Attendance and Class
Participation (5%)
12/10/2013
27
Presentation 5 and 6 (10%)
Attendance and Class
Participation (5%)
12/12/2013
28
PROJECT DUE
Samreen Malik
Project Report
(25%) Due
Attendance and Class
Participation (5%)
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