Course Syllabus Econ 555: International Trade Academic Year Winter Session Term 2

Transcription

1 Course Syllabus Econ 555: International Trade Academic Year Winter Session Term 2 Professor: Matilde Bombardini, Iona Building 208, , matildeb@mail.ubc.ca Office Hours: by appointment. Webpage Introduction This is a graduate level course in international trade. We will cover the different theories of international trade and empirical applications. As I update the content of the course, the syllabus may change and I will post the updated version on Connect. Schedule Class hours: M-W 12-1:30, UCLL 109 Recommended Books: Feenstra, Robert C Advanced International Trade: Theory and Evidence. Princeton University Press. Second Edition (F) Helpman, Elhanan, and Paul R. Krugman Market Structure and Foreign Trade. MIT Press. (HK85) Additional Recommended books: Dixit, Avinash K., and Victor Norman Theory of International Trade. Cambridge University Press. (DN) Bagwell, Kyle, and Robert W. Staiger The Economics of the World Trading System. MIT Press. Grossman, Gene, and Elhanan Helpman Innovation and Growth in the Global Economy. MIT Press. (GH93) Helpman, Elhanan and Paul R. Krugman Trade Policy and Market Structure. MIT Press. (HK89) Baldwin, Richard E., Rikard Forslid, Philippe Martin, Gianmarco Ottaviano, and Frederic Robert-Nicoud Economic Geography and Public Policy. Princeton University Press. 1

2 Fujita, Masahisa, Paul R. Krugman, and Anthony Venables The Spatial Economy. MIT Press. Krugman, Paul R Rethinking International Trade. MIT Press. (K90) Choi, E. Kwan and James Harrigan (editors) Handbook of International Trade. Blackwell Publishing Ltd. (CH) Jones, Ronald W. and Peter B. Kenen (editors) Handbook of International Economics (Volume 1 International Trade). Elsevier North Holland (JK) Grossman, Gene M. and Kenneth Rogoff (editors) Handbook of International Economics (Volume 3). Elsevier North Holland (GR) Gopinath, Gita, Elhanan Helpman and Kenneth Rogoff (editors) Handbook of International Economics (GHR) Jonathan Eaton and Sam Kortum are in the process of writing a book that will be useful for some of the topics covered in this course. The book title is Technology in the Global Economy: A Framework for Quantitative Analysis. Class web site The class website is on Connect at Class announcements, problem sets, syllabus, lecture slides, and the reading list will be available on the website. I will update the website regularly as the class proceeds. Articles: Most of the readings are available online. You can search all online journals via the UBC Library. I will make sure readings not available online will be posted on Connect. Grading There are three elements to your final grade: Problem sets (30%): there will be 3 problem sets which will include both empirical exercises and model-based questions. You can collaborate on problem sets. I just want everyone to contribute equally to the final outcome. A final exam (40%) during Final Exam period Gravity exercise (30%): you will have to replicate and extend the results in Head and Mayer s Handbook Chapter Gravity Equations: Workhorse, Toolkit, and Cookbook which we will discuss in class halfway through the course. Extending the results means that you will have to formulate a novel hypothesis and test it on the data. The write-up of the replication exercise will be due at the end of the course on April 5 th. 2

3 Class Outline and Readings Not all the following readings are required. It will be obvious from the lecture notes which papers you need to cover in detail. I will not ask questions in the exam that are based on material that is in the paper, but not on the slides. You should take this reading list as a reference if you want to explore certain topics in depth. 1. Gains from trade and comparative advantage (2 classes) Dixit-Norman Chapter 2, 3, 4 Bernhofen, Daniel and John C. Brown A Direct Test of the Theory of Comparative Advantage: The Case of Japan. Journal of Political Economy 112: Bernhofen, Daniel and John C. Brown An Empirical Assessment of the Comparative Advantage Gains from Trade: Evidence from Japan. American Economic Review 95: Feyrer, James Trade and Income Exploiting Time Series in Geography unpublished manuscript Feyrer, James Distance, Trade, and Income - The 1967 to 1975 Closing of the Suez Canal as a Natural Experiment Frankel, Jeffrey and David Romer Does Trade Cause Growth? American Economic Review, 89(3): Rodriguez and Rodrik Trade Policy and Economic Growth: A Skeptics Guide to Cross-National Evidence. In NBER Macroeconomics Annual 2000 edited by Ben S. Bernanke and Kenneth Rogoff. Cambridge, Mass.: MIT Press. Wacziarg, Romain, and Karen Horn Welch Trade Liberalization and Growth: New Evidence. World Bank Economic Review 22(2): Technology Differences: Ricardian Trade Theory (3 classes) Feenstra Chapter 1 Dornbusch, Rudiger, Stanley Fischer, and Paul A. Samuelson Comparative Advantage, Trade, and Payments in a Ricardian Model with a Continuum of Goods. American Economic Review 67: Eaton, Jonathan, and Samuel Kortum Technology, Geography, and Trade. Econometrica 70: Costinot, A., D. Donaldson and A. Komunjer "What Goods Do Countries Trade? A Quantitative Exploration of Ricardo's Ideas" Review of Economic Studies, 79(2):

4 3. Factor Endowment Differences: Heckscher - Ohlin Theory (3 classes) Feenstra Chapter 1 (second part), 2 and 3 Helpman-Krugman (1985) Chapter 1 Dixit-Norman Chapter 4 Leamer, Edward The Leontief Paradox, Reconsidered. Journal of Political Economy 88: Trefler, Daniel International Factor Price Differences: Leontief Was Right! Journal of Political Economy 101: Trefler, Daniel The Case of the Missing Trade and Other Mysteries. American Economic Review 85: Davis, Donald and David Weinstein, An account of global factor trade, American Economic Review, 91: Romalis, John. "Factor proportions and the structure of commodity trade." The American Economic Review 94.1 (2004): Imperfect Competition and Trade: Monopolistic Competition (Theory and Empirics) (3 classes) Krugman, Paul R Increasing Returns, Monopolistic Competition, and International Trade. Journal of International Economics 9: Reprinted in Rethinking International Trade. Krugman, P., Scale economies, product differentiation, and the pattern of trade. American Economic Review, 70(5), pp Evenett, Simon J., and Wolfgang Keller On the Theories Explaining the Success of the Gravity Equation. Journal of Political Economy 110: Hanson, Gordon H., and Chong Xiang. "The home-market effect and bilateral trade patterns." The American Economic Review 94.4 (2004): Davis, Donald R., and David E. Weinstein. "Market access, economic geography and comparative advantage: an empirical test." Journal of International Economics 59.1 (2003): Davis, Donald R Intra-Industry Trade: a Heckscher-Ohlin-Ricardo Approach. Journal of International Economics 39: Imperfect Competition, Productivity Differences and Trade: the Firm Heterogeneity Models and Empirical Evidence (3 classes) Aw, Bee Yan, Sukkyun Chung, and Mark Roberts Productivity and Turnover in the Export Market: Micro-Level Evidence from the Republic of Korea and Taiwan (China). The World Bank Economic Review 14(1):

5 Trefler, Daniel. "The long and short of the Canada-US free trade agreement." The American Economic Review 94.4 (2004): Pavcnik, Nina Trade Liberalization, Exit, and Productivity Improvements: Evidence from Chilean Plants. The Review of Economic Studies 69: Tybout, James Plant- and firm-level Evidence on the New Trade Theories. Printed in CH. NBER Working Paper 8418 Bernard, Andrew, Jonathan Eaton, Bradford Jensen, and Samuel Kortum Plants and Productivity in International Trade. American Economic Review 93: Melitz, Marc The Impact of Trade on Intra-industry Reallocations and Aggregate Industry Productivity. Econometrica 71: Bernard, Andrew, Steve Redding and Peter Schott Comparative Advantage and Heterogeneous Firms. Review of Economic Studies 74: Arkolakis, C., A. Costinot and A. Rodriguez-Clare New Trade Models, Same Old Gains? American Economic Review, 102(1): Gravity and Transportation Costs (2 classes) Head, K. and Mayer, T., Gravity equations: Toolkit, cookbook, workhorse. Handbook of international economics, 4, pp Hummels, David. "Transportation costs and international trade in the second era of globalization." The Journal of Economic Perspectives 21.3 (2007): Variable Mark-ups and Pro-Competitive Effects of Trade (2 classes) Melitz, Marc and Gianmarco Ottaviano Market Size, Trade, and Productivity. Review of Economic Studies 75: Feenstra, Robert and David Weinstein Globalization, Competition, and U.S. Welfare Forthcoming Journal of Political Economy J. De Loecker, P. Goldberg, A. Khandelwal and N. Pavcnik Prices, Markups and Trade Reform (with J. De Loecker, P. Goldberg and N. Pavcnik) Econometrica, 84(2), Edmond, Chris, Virgiliu Midrigan, and Daniel Yi Xu. "Competition, markups, and the gains from international trade." The American Economic Review (2015): International Trade and Labor Markets (4 classes) Harrison, A., McLaren, J. and McMillan, M., Recent Perspectives on Trade and Inequality. Annual Review of Economics, 3(1), pp Krugman, Paul Trade and Wages, Reconsidered. Brookings Paper on Economic Activity 1:

6 Autor, D., Dorn, D. and Hanson, G.H., The China syndrome: Local labor market effects of import competition in the United States. The American Economic Review, 103(6), pp Autor, D., Dorn, D., Hanson, G.H. and Song, J., Trade Adjustment: Worker-Level Evidence. Quarterly Journal of Economics, 129(4). Artuç, E., Chaudhuri, S. and McLaren, J., Trade shocks and labor adjustment: A structural empirical approach. The American Economic Review, 100(3), pp Burstein, Ariel and Jonathan Vogel International Trade, Technology, and the Skill Premium Forthcoming Journal of Political Economy Grossman, Gene and Esteban Rossi-Hansberg Trading tasks: A simple theory of offshoring American Economic Review, 98(5): Hummels, David, Rasmus Jorgensen, Jakob Munch and Chong Xiang The Wage Effects of Offshoring: Evidence from Danish Matched Worker-Firm Data American Economic Review, 104(6): Antràs, Pol, Luis Garicano, and Esteban Rossi-Hansberg Offshoring in a Knowledge Economy, Quarterly Journal of Economics 2006, pp Helpman, Elhanan and Oleg Itskhoki Labor Market Rigidities, Trade and Unemployment Review of Economic Studies 77: Helpman, Elhanan, Oleg Itskhoki and Stephen Redding Inequality and Unemployment in a Global Economy, Econometrica 78: Grossman, Gene and Giovanni Maggi Diversity and Trade American Economic Review 90(5): Bombardini, M., G. Gallipoli, G. Pupato Skill Dispersion and Trade Flows American Economic Review, 102(5): International Trade, Quality and Innovation (3 classes) Lileeva, Alla, and Daniel Trefler. "Improved Access to Foreign Markets Raises Plantlevel Productivity For Some Plants." The Quarterly Journal of Economics (2010): Khandelwal, Amit. The long and short (of) quality ladders. The Review of Economic Studies 77.4 (2010): Kugler, Maurice, and Eric Verhoogen. Prices, plant size, and product quality. The Review of Economic Studies 79.1 (2012): Bustos, P., Trade liberalization, exports, and technology upgrading: Evidence on the impact of MERCOSUR on Argentinian firms. American Economic Review, 101(1), pp Bloom, Nicholas, Mirko Draca, and John Van Reenen. "Trade induced technical change? The impact of Chinese imports on innovation, IT and productivity." The Review of Economic Studies 83.1 (2016):

7 Atkeson, Andrew, and Ariel Tomás Burstein. "Innovation, Firm Dynamics, and International Trade." Journal of Political Economy (2010):