《國際經(jīng)濟學(xué)》課后習(xí)題答案

1、Chapter 2nAnswers to Textbook Problems1.We saw that not only is GDP important in explaining how much two countries trade, but also, distance is crucial. Given its remoteness, Australia faces relatively high costs of transporting imports and exports, thereby reducing the attractiveness of trade. Sinc

2、e Canada has a border with a large economy (the U.S.) and Australia is not near any other major economy, it makes sense that Canada would be more open and Australia more self-reliant.2.Mexico is quite close to the U.S., but it is far from the European Union (EU). So it makes sense that it trades lar

3、gely with the U.S. Brazil is far from both, so its trade is split between the two. Mexico trades more than Brazil in part because it is so close to a major economy (the U.S.) and in part because it is a member of a free trade agreement with a large economy (NAFTA). Brazil is farther away from any la

4、rge economy and is in a free trade agreement with relatively small countries.3.No, if every countrys GDP were to double, world trade would not quadruple. One way to see this using the example from Table 2-2 would simply be to quadruple all the trade flows in 2-2 and also double the GDP in 2-1. We wo

5、uld see that the first line of Table 2-2 would be, 6.4, 1.6, 1.6. If that were true, Country A would have exported $8 trillion which is equal to its entire GDP. Likewise, it would have imported $8 trillion, meaning it had zero spending on its own goods (highly unlikely). If instead we filled in Tabl

6、e 2-2 as before, by multiplying the appropriate shares of the world economy times a countrys GDP, we would see the first line of Table 2-2 reads, 3.2, 0.8, 0.8. In this case, 60% of Country As GDP is exported, the same as before. The logic is that while the world GDP has doubled, increasing the like

7、lihood of international trade, the local economy has doubled, increasing the likelihood of domestic trade. The gravity equation still holds. If you fill in the entire table, you will see that where before the equation was 0.1 GDPi GDPj, it now is 0.05 GDPi GDPj. The coefficient on each GDP is still

8、one, but the overall constant has changed.4.As the share of world GDP which belongs to East Asian economies grows, then in every trade relationship which involves an East Asian economy, the size of the East Asian economy has grown. This makes the trade relationships with East Asian countries larger

9、over time. The logic is similar for why the countries trade more with one another. Previously, they were quite small economies, meaning that their markets were too small to import a substantial amount. As they became more wealthy and the consumption demands of their populace rose, they were each abl

10、e to import more. Thus, while they previously had focused their exports to other rich nations, over time, they became part of the rich nation club and thus were targets for one anothers exports. Again, using the gravity model, when South Korea and Taiwan were both small, the product of their GDPs wa

11、s quite small, meaning despite their proximity, there was little trade between them. Now that they have both grown considerably, their GDPs predict a considerable amount of trade.5.As the chapter discusses, a century ago, much of world trade was in commodities that in many ways were climate or geogr

12、aphy determined. Thus, the UK imported goods that it could not make itself. This meant importing things like cotton or rubber from countries in the Western Hemisphere or Asia. As the UKs climate and natural resource endowments were fairly similar to those in the rest of Europe, it had less of a need

13、 to import from other European countries. In the aftermath of the Industrial Revolution, where manufacturing trade accelerated and has continued to expand with improvements in transportation and communications, it is not surprising that the UK would turn more to the nearby and large economies in Eur

14、ope for much of its trade. This is a direct prediction of the gravity model.Chapter 3nAnswers to Textbook Problems1.a.The production possibility curve is a straight line that intercepts the apple axis at 400(1200/3) and the banana axis at 600(1200/2).b.The opportunity cost of apples in terms of bana

15、nas is 3/2. It takes three units of labor to harvest an apple but only two units of labor to harvest a banana. If one foregoes harvesting an apple, this frees up three units of labor. These 3 units of labor could then be used to harvest 1.5 bananas.c.Labor mobility ensures a common wage in each sect

16、or and competition ensures the price of goods equals their cost of production. Thus, the relative price equals the relative costs, which equals the wage times the unit labor requirement for apples divided by the wage times the unit labor requirement for bananas. Since wages are equal across sectors,

17、 the price ratio equals the ratio of the unit labor requirement, which is 3 apples per 2 bananas.2.a.The production possibility curve is linear, with the intercept on the apple axis equal to 160(800/5) and the intercept on the banana axis equal to 800(800/1).b.The world relative supply curve is cons

18、tructed by determining the supply of apples relative to the supply of bananas at each relative price. The lowest relative price at which apples are harvested is 3 apples per 2 bananas. The relative supply curve is flat at this price. The maximum number of apples supplied at the price of 3/2 is 400 s

19、upplied by Home while, at this price, Foreign harvests 800 bananas and no apples, giving a maximum relative supply at this price of 1/2. This relative supply holds for any price between 3/2 and 5. At the price of 5, both countries would harvest apples. The relative supply curve is again flat at 5. T

20、hus, the relative supply curve is step shaped, flat at the price 3/2 from the relative supply of 0 to 1/2, vertical at the relative quantity 1/2 rising from 3/2 to 5, and then flat again from 1/2 to infinity. 3.a.The relative demand curve includes the Points (1/5, 5), (1/2, 2), (1, 1), (2, 1/2).b.Th

21、e equilibrium relative price of apples is found at the intersection of the relative demand and relative supply curves. This is the Point (1/2, 2), where the relative demand curve intersects the vertical section of the relative supply curve. Thus the equilibrium relative price is 2.c.Home produces on

22、ly apples, Foreign produces only bananas, and each country trades some of its product for the product of the other country.d.In the absence of trade, Home could gain three bananas by foregoing two apples, and Foreign could gain by one apple foregoing five bananas. Trade allows each country to trade

23、two bananas for one apple. Home could then gain four bananas by foregoing two apples while Foreign could gain one apple by foregoing only two bananas. Each country is better off with trade. 4.The increase in the number of workers at Home shifts out the relative supply schedule such that the corner P

24、oints are at (1, 3/2) and (1, 5), instead of (1/2, 3/2) and (1/2, 5). The intersection of the relative demand and relative supply curves is now in the lower horizontal section, at the Point (2/3, 3/2). In this case, Foreign still gains from trade but the opportunity cost of bananas in terms of apple

25、s for Home is the same whether or not there is trade, so Home neither gains nor loses from trade. 5.This answer is identical to that in 3. The amount of “effective labor” has not changed since the doubling of the labor force is accompanied by a halving of the productivity of labor. 6.This statement

26、is just an example of the pauper labor argument discussed in the chapter. The point is that relative wage rates do not come out of thin air; they are determined by comparative productivity and the relative demand for goods. The box in the chapter provides data which shows the strong connection betwe

27、en wages and productivity. Chinas low wage presumably reflects the fact that China is less productive than the United States in most industries. As the test example illustrated, a highly productive country that trades with a less productive, low-wage country will raise, not lower, its standard of li

28、ving. 7.The problem with this argument is that it does not use all the information needed for determining comparative advantage in production: this calculation involves the four unit labor requirements (for both the industry and service sectors, not just the two for the service sector). It is not en

29、ough to compare only services unit labor requirements. IfHome labor is more efficient than Foreign labor in services. While this demonstrates that the United States has an absolute advantage in services, this is neither a necessary nor a sufficient condition for determining comparative advantage. Fo

30、r this determination, the industry ratios are also required. The competitive advantage of any industry depends on both the relative productivities of the industries and the relative wages across industries. 8.While Japanese workers may earn the equivalent wages of U.S. workers, the purchasing power

31、of their income is one-third less. This implies that although w = w* (more or less), p p* (since 3p = p*). Since the United States is considerably more productive in services, service prices are relatively low. This benefits and enhances U.S. purchasing power. However, many of these services cannot

32、be transported and hence, are not traded. This implies that the Japanese may not benefit from the lower U.S. services costs, and do not face an international price which is lower than their domestic price. Likewise, the price of services in United States does not increase with the opening of trade s

33、ince these services are non-traded. Consequently, U.S. purchasing power is higher than that of Japan due to its lower prices on non-traded goods. 9.Gains from trade still exist in the presence of non-traded goods. The gains from trade decline as the share of non-traded goods increases. In other word

34、s, the higher the portion of goods which do not enter the international marketplace, the lower the potential gains from trade. If transport costs were high enough so that no goods were traded, then, obviously, there would be no gains from trade.10.The world relative supply curve in this case consist

35、s of a step function, with as many “steps” (horizontal portions) as there are countries with different unit labor requirement ratios. Any countries to the left of the intersection of the relative demand and relative supply curves export the good in which they have a comparative advantage relative to

36、 any country to the right of the intersection. If the intersection occurs in a horizontal portion then the country with that price ratio produces both goods.Chapter 4nAnswers to Textbook Problems1.The definition of cattle growing as land intensive depends on the ratio of land to labor used in produc

37、tion, not on the ratio of land or labor to output. The ratio of land to labor in cattle exceeds the ratio in wheat in the United States, implying cattle is land intensive in the United States. Cattle is land intensive in other countries as well if the ratio of land to labor in cattle production exce

38、eds the ratio in wheat production in that country. Comparisons between another country and the United States is less relevant for this purpose. 2.a.The box diagram has 600 as the length of two sides (representing labor) and 60 as the length of the other two sides (representing land). There will be a

39、 ray from each of the two corners representing the origins. To find the slopes of these rays we use the information from the question concerning the ratios of the production coefficients. The question states that aLC/aTC = 20 and aLF/aTF = 5.Since aLC/aTC = (LC/QC)/(TC/QC) = LC/TC we have LC = 20TC.

40、 Using the same reasoning, aLF/aTF = (LF/QF)/(TF/QF) = LF/TF and since this ratio equals 5, we have LF = 5TF. We can solve this algebraically since L = LC + LF = 600 and T = TC + TF = 60.The solution is LC = 400, TC = 20, LF = 200 and TF = 40.b.The dimensions of the box change with each increase in

41、available labor, but the slopes of the rays from the origins remain the same. The solutions in the different cases are as follows.L = 800:TC = 33.33,LC = 666.67,TF = 26.67,LF = 133.33L = 1000:TC = 46.67,LC = 933.33,TF = 13.33,LF = 66.67L = 1200:TC = 60,LC = 1200,TF = 0,LF = 0. (complete specializati

42、on).c.At constant factor prices, some labor would be unused, so factor prices would have to change, or there would be unemployment.3.This question is similar to an issue discussed in Chapter 3. What matters is not the absolute abundance of factors, but their relative abundance. Poor countries have a

43、n abundance of labor relative to capital when compared to more developed countries. 4.In the Ricardian model, labor gains from trade through an increase in its purchasing power. This result does not support labor union demands for limits on imports from less affluent countries. The Heckscher-Ohlin m

44、odel directly addresses distribution by considering the effects of trade on the owners of factors of production. In the context of this model, unskilled U.S. labor loses from trade since this group represents the relatively scarce factors in this country. The results from the Heckscher-Ohlin model s

45、upport labor union demands for import limits. In the short run, certain unskilled unions may gain or lose from trade depending on in which sector they work, but in theory, in the longer run, the conclusions of the Heckscher-Ohlin model will dominate.5.Specific programmers may face wage cuts due to t

46、he competition from India, but this is not inconsistent with skilled labor wages rising. By making programming more efficient in general, this development may have increased wages for others in the software industry or lowered the prices of the goods overall. In the short run, though, it has clearly

47、 hurt those with sector specific skills who will face transition costs. There are many reasons to not block the imports of computer programming services (or outsourcing of these jobs). First, by allowing programming to be done more cheaply, it expands the production possibilities frontier of the U.S

48、., making the entire country better off on average. Necessary redistribution can be done, but we should not stop trade which is making the nation as a whole better off. In addition, no one trade policy action exists in a vacuum, and if the U.S. blocked the programming imports, it could lead to broad

49、er trade restrictions in other countries. 6.The factor proportions theory states that countries export those goods whose production is intensive in factors with which they are abundantly endowed. One would expect the United States, which has a high capital/labor ratio relative to the rest of the wor

50、ld, to export capital-intensive goods if the Heckscher-Ohlin theory holds. Leontief found that the United States exported labor-intensive goods. Bowen, Leamer and Sveikauskas found for the world as a whole the correlation between factor endowment and trade patterns to be tenuous. The data do not sup

51、port the predictions of the theory that countries exports and imports reflect the relative endowments of factors.7.If the efficiency of the factors of production differs internationally, the lessons of the Heckscher-Ohlin theory would be applied to “effective factors” which adjust for the difference

52、s in technology or worker skills or land quality (for example). The adjusted model has been found to be more successful than the unadjusted model at explaining the pattern of trade between countries. Factor-price equalization concepts would apply to the effective factors. A worker with more skills o

53、r in a country with better technology could be considered to be equal to two workers in another country. Thus, the single person would be two effective units of labor. Thus, the one high-skilled worker could earn twice what lower-skilled workers do, and the price of one effective unit of labor would

54、 still be equalized.Chapter 5nAnswers to Textbook Problems1.Note how welfare in both countries increases as the two countries move from production patterns governed by domestic prices (dashed line) to production patterns governed by world prices (straight line).2.3.An increase in the terms of trade

55、increases welfare when the PPF is right-angled. The production point is the corner of the PPF. The consumption point is the tangency of the relative price line and the highest indifference curve. An improvement in the terms of trade rotates the relative price line about its intercept with the PPF re

56、ctangle (since there is no substitution of immobile factors, the production point stays fixed). The economy can then reach a higher indifference curve. Intuitively, although there is no supply response, the economy receives more for the exports it supplies and pays less for the imports it purchases.

57、4.The difference from the standard diagram is that the indifference curves are right angles rather than smooth curves. Here, a terms of trade increase enables an economy to move to a higher indifference curve. The income expansion path for this economy is a ray from the origin. A terms of trade impr

58、ovement moves the consumption point further out along the ray.5.The terms of trade of Japan, a manufactures (M) exporter and a raw materials (R) importer, is the world relative price of manufactures in terms of raw materials (pM/pR). The terms of trade change can be determined by the shifts in the w

59、orld relative supply and demand (manufactures relative to raw materials) curves. Note that in the following answers, world relative supply (RS) and relative demand (RD) are always M relative to R. We consider all countries to be large, such that changes affect the world relative price.a.Oil supply disruption from the Middle East decreases the supply of raw materi