ECONOMICS 470

INTERNATIONAL TRADE AND FINANCE

Dr. Ananish Chaudhuri

Why Study International Economics?

We live in a world of increasing "international interdependence" where complex economic ties bind countries to one another. This course looks at the questions which arise from that interdependence. We consider why countries engage in trade with each other. The volume of trade that countries engage in have been growing rapidly over time. We look at the theories which demonstrate how countries can enjoy mutual gains from trade contrary to the popular view that trade is like a competitive sport where the gains of one nation must necessarily come at the expense of the other. We look at a variety of barriers to trade such tariffs and quotas and examine the reasons why countries decide to use them. We look at the distributional issues of trade in terms of the gains and losses imposed on producers and consumers through trade. We also consider questions of international finance and see how exchange rates are determined and how events in far away in countries have an impact on the US economy.

Whether you are a national policy maker or a business owner planning strategy or simply an informed citizen and voter, it is important to have understanding of international economics, because these events, even if they happen in distant countries, have a large impact on our lives and the prices we pay for the goods that we consume.