International Trade

The course will be taught online via zoom. The link to the lectures will be distributed each week closer to the date of the corresponding lecture. The platform for the course webpage is Piazza. Please, send an email to Alexander Tarasov to be signed up. All the materials (including zoom links) will be uploaded there. The purpose of this course is to introduce students into the classical and modern theories of international trade. In particular, I am going to address three main questions: (i) What are the patterns of trade we observe in the real world (who sells what to whom?) and how can we explain them? (ii) If international trade is welfare improving, can we say something about the magnitude of these gains from trade? (iii) What is the effect of different trade policies on country’s welfare? The course will be divided into several parts. In the first part, we will study the classical trade theories based on the principle of a comparative advantage, which is originated to Ricardo. In the second part, we will talk about the, so called, new trade theory that was developed by Paul Krugman (he won a Nobel Prize for this theory) and, then, Elhanan Helpman among others. The third part will be devoted to the analysis of various instruments of trade policy under different assumptions for the market structure. We will try to understand which policy is beneficial for country’s welfare and in which cases. In the fourth part, we will try to understand the magnitude of the welfare gains. This part of the course will be based on recent seminal trade papers. Specifically, we will focus on the quantitative macro approach to understanding the size of the gains from trade. In addition, we consider a study based on a trade natural experiment. There will be also a part of the course that you will study on your own using the online course on International Trade (which is specified later). Finally, we will discuss some assorted topics in trade.