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JOHN CABOT UNIVERSITY

COURSE CODE: "EC 316-2"
COURSE NAME: "International Economics"
SEMESTER & YEAR: Spring 2018
SYLLABUS

INSTRUCTOR: John Westley
EMAIL: [email protected]
HOURS: MW 1:30-2:45 PM
TOTAL NO. OF CONTACT HOURS: 45
CREDITS: 3
PREREQUISITES: Prerequisites: Junior Standing, EC 201, EC 202
OFFICE HOURS:

COURSE DESCRIPTION:
An introduction to international trade and finance. Analysis of the causes and consequences of international trade and investment. Major topics include international trade theory, international trade policy, exchange rates, open-economy macroeconomics, and international macroeconomic policy.
SUMMARY OF COURSE CONTENT:
The course will cover selected topics in international trade theory (the theory of comparative advantage, external economies and international trade, international labor mobility) and trade policy (instruments of trade policy, the political economy of trade policy, trade policy in developing countries) as well as international finance and macroeconomic policy (national income accounting and the balance of payments, determination of exchange rates, the open economy macroeconomic model, the evolution of the international monetary system, optimum currency areas and the Euro, and international economic issues for developing countries). 



LEARNING OUTCOMES:
By the end of the course students should be able to apply the appropriate theoretical framework to the problem being discussed, should be able to access appropriate sources of information about international economic issues, should understand the main features of the institutions affecting the global economy, should be able to trace broad outlines of the evolution of the global economy over the past century and their implications for current issues in the field of international economics, should be able to distinguish good economic arguments for trade policy and international macroeconomic policy from arguments based on vested interests, narrow nationalism or ideology, should understand the distributional consequences of international economic trends, and should be able to apply critical analysis of international economic issues effectively in written and oral form. 
TEXTBOOK:
Book TitleAuthorPublisherISBN numberLibrary Call NumberCommentsFormatLocal BookstoreOnline Purchase
International Economics Tenth Edition Krugman et al Pearson 978-1-292-01955-0     
REQUIRED RESERVED READING:
Book TitleAuthorPublisherISBN numberLibrary Call NumberComments
End This Depression NowKrugmanW W Norton 978-0393088779  
Why Globalization WorksWolfYale 978-0300102526  
The Shifts and the Shocks Martin Wolf Penguin978-1-59420-544-6  
In Defense of Globalization Jagdish BhagwatiOxford978-0-19-533093-9  

RECOMMENDED RESERVED READING:
NONE
GRADING POLICY
-ASSESSMENT METHODS:
AssignmentGuidelinesWeight
Exam 1Exam 1 covers the material in chapters 1-10 and 12 in the text. 20%
Exam 2Exam 2 covers chapters 11, 13, 14 and 16 in the text. 20%
Exam 3Exam 3 covers chapters 17-18 in the text. 20%
Class ParticipationStudents may submit up to two 2-3 pages papers during each exam cycle. The assignments will be handed out after the first session in each exam cycle. The papers count as 1 point each. Active participation in class discussions will be awarded up to 2 points for the semester. 10%
Final ExamThe final exam will emphasize chapters 19-20 and 22 in the text, but is comprehensive. 30%

-ASSESSMENT CRITERIA:
AWork of this quality directly addresses the question or problem raised and provides a coherent argument displaying an extensive knowledge of relevant information or content. This type of work demonstrates the ability to critically evaluate concepts and theory and has an element of novelty and originality. There is clear evidence of a significant amount of reading beyond that required for the course.
BThis is highly competent level of performance and directly addresses the question or problem raised.There is a demonstration of some ability to critically evaluatetheory and concepts and relate them to practice. Discussions reflect the student’s own arguments and are not simply a repetition of standard lecture andreference material. The work does not suffer from any major errors or omissions and provides evidence of reading beyond the required assignments.
CThis is an acceptable level of performance and provides answers that are clear but limited, reflecting the information offered in the lectures and reference readings.
DThis level of performances demonstrates that the student lacks a coherent grasp of the material.Important information is omitted and irrelevant points included.In effect, the student has barely done enough to persuade the instructor that s/he should not fail.
FThis work fails to show any knowledge or understanding of the issues raised in the question. Most of the material in the answer is irrelevant.

-ATTENDANCE REQUIREMENTS:
ATTENDANCE REQUIREMENTS AND EXAMINATION POLICY
You cannot make-up a major exam (midterm or final) without the permission of the Dean’s Office. The Dean’s Office will grant such permission only when the absence was caused by a serious impediment, such as a documented illness, hospitalization or death in the immediate family (in which you must attend the funeral) or other situations of similar gravity. Absences due to other meaningful conflicts, such as job interviews, family celebrations, travel difficulties, student misunderstandings or personal convenience, will not be excused. Students who will be absent from a major exam must notify the Dean’s Office prior to that exam. Absences from class due to the observance of a religious holiday will normally be excused. Individual students who will have to miss class to observe a religious holiday should notify the instructor by the end of the Add/Drop period to make prior arrangements for making up any work that will be missed. 

Those who have 4 or fewer absences may delete the score from one of the first three exams with the lowest score and substitute the score from the exam with next highest score. 
ACADEMIC HONESTY
As stated in the university catalog, any student who commits an act of academic dishonesty will receive a failing grade on the work in which the dishonesty occurred. In addition, acts of academic dishonesty, irrespective of the weight of the assignment, may result in the student receiving a failing grade in the course. Instances of academic dishonesty will be reported to the Dean of Academic Affairs. A student who is reported twice for academic dishonesty is subject to summary dismissal from the University. In such a case, the Academic Council will then make a recommendation to the President, who will make the final decision.
STUDENTS WITH LEARNING OR OTHER DISABILITIES
John Cabot University does not discriminate on the basis of disability or handicap. Students with approved accommodations must inform their professors at the beginning of the term. Please see the website for the complete policy.

SCHEDULE

PART 1: INTERNATIONAL TRADE THEORY AND POLICY

January 15: Chapter 1, Introduction (skim all), Chapter 2, World Trade: An Overview (skim all)

January 17: Chapter 3, Labor Productivity and Comparative Advantage: The Ricardian Model (We will cover only the following sections: The Concept of Comparative Advantage, A One-Factor Economy; Trade in a One-Factor World, Comparative Advantage in Practice: The Case of Babe Ruth, The Losses from Nontrade; Misconceptions About Comparative Advantage; Do Wages Reflect Productivity? Empirical Evidence on the Ricardian Model 

January 22: Chapter 3 (continued)

January 24: Chapter 4, Specific Factors and Income Distribution The Political Economy of Trade: A Preliminary View; Case Study; Trade and Unemployment; Income Distribution and Trade Politics; International Labor Mobility; Case Study: Wage Convergence in the Age of Mass Migration; Case Study: Immigration and the US Economy

January 29: Chapter 5, Resources and Trade: The Heckscher-Ohlin Model: Case Study: North-South Trade and Income Inequality; 
Chapter 6: The Standard Trade Model: 
Has the Growth of Newly Industrializing Countries Hurt Advanced Nations? and Chapter 7, External Economies of Scale and the International Location of Production: Economies of Scale and International Trade: An Overview; Economies of Scale and Market Structure; The Theory of External Economies; External Economies and International Trade; Holding the World Together; Tinseltown Economics; Interregional Trade and Economic Geography

PART 2: INTERNATIONAL TRADE POLICY

January 31: Chapter 8, Firms in the Global Economy: Export Decisions, Outsourcing, and Multinational Enterprises; Multinational and Outsourcing; Case Study: Patterns of Foreign Direct Investment Around the World; Outsourcing; Consequences of Multinationals and Foreign Outsourcing Chapter 9, The Instruments of Trade Policy (all sections)

February 5 (makeup day for Monday, April 1): Chapter 9 (continued); Chapter 10, The Political Economy of Trade Policy (all sections)

February 7: Chapter 10 (continued); Chapter 12: Controversies in Trade Policy; Globalization and Low-Wage Labor; Case Study: Bare Feet, Hot Metal, and Globalization; Globalization and the Environment

February 12: EXAM 1 (Chapters 1-10, 12)

February 14: Chapter 11, Trade Policy in Developing Countries (all sections)

PART 3: EXCHANGE RATES AND OPEN ECONOMY MACROECONOMICS

February 19: Chapter 11 (continued); Chapter 13, National Income Accounting and the Balance of Payments The National Income Accounts;  National Income Accounting for an Open Economy; Case Study: Government Deficit Reduction May Not Increase the Current Account  Surplus; Case Study: The Assets and Liabilities of the World’s Largest Debtor)

February 21: Chapter 13 (continued)

February 26: Chapter 14, Exchange Rates and the Foreign Exchange Market: An Asset Approach (all sections)

February 28: Chapter 14 (continued) 

March 5: Chapter 14 (continued)

March 7: Chapter 16, Price Levels and the Exchange Rate in the Long Run The Law of One Price; Purchasing Power Parity; Empirical  Evidence on PPP and the Law on One Price; Box: Some Meaty Evidence on the Law on One Price; Case Study: Why Price Levels Are  Lower    in Poorer Countries

March 12: EXAM 2 (Chapters 11, 13-14 and 16)

March 14: Chapter 17, Output and the Exchange Rate in the Short Run (Determinants of Aggregate Demand in an Open Economy; The  Equation of Aggregate Demand; How Output Is Determined in the Short Run; Output Market Equilibrium in the Short Run: The DD  Schedule; Asset Market Equilibrium in the Short Run: The AA Schedule; Short-Run Equilibrium in an Open Economy: Putting the DD and  AA Schedules Together; Temporary Changes in Monetary and Fiscal Policy 

March 19: Chapter 17 (continued) 

March 21: Chapter 18, Fixed Exchange Rates and Foreign Exchange Intervention Why Study Fixed Exchange Rates? Central Bank Intervention and the Money Supply; Central Bank Balance Sheet and the Money Supply; How the Central Bank Fixes the Exchange Rate; Stabilization Policies with a Fixed Exchange Rate; Balance of Payment Crises and Capital Flight; Reserve Currencies in the World Monetary System; The Gold Standard; Case Study: The Demand for International Reserves  

March 26: Chapter 18 (continued) 

March 28: EXAM 3 (Chapters 17-18)

PART 4: INTERNATIONAL MACROECONOMIC POLICY

April 9: Chapter 19, International Monetary Systems, An Historical Overview (all sections)

April 11: Chapter 19 (continued)

April 16: Chapter 21: Optimum Currency Areas and the European Experience (all sections)

April 18: Chapter 21 (continued); 

April 23: Chapter 22, Developing Countries: Growth, Crisis and Reform (all sections)

April 27: Review 

FINAL EXAM (Comprehensive, but emphasis on Chapters 19-20, 22); April 30, 6 PM, Aula Magna