Fall 2007
Course Outline
ARE 201 (Half of semester)
Introduction to Trade Theory and Policy
Instructor: Larry Karp
207 Giannini, tel 642 7199, email [email protected]
Office hours, Friday 9  10 and by appointment.
Course Objective: Introduce students to the basic models and theorems of international
trade.
Develop intuition about trade, and especially general equilibrium models.
Approach: I will emphasize geometric arguments because I think that these are
particularly useful for developing intuition. In some cases I'll show the algebraic
treatment.
In 20 hours of lectures I want to go through a large amount of basic trade
theory, and illustrate its importance using several policy applications.
I will not
attempt to discuss the empirical trade literature, or the "new trade theory".
This course
should prepare students to begin reading the frontier work in trade.
It is not, however,
intended to be a course about the frontier.
Readings: Lecture notes and problem sets (and later, the solution keys) are available
on webpage http://are.berkeley.edu/courses/ARE201. These notes should make it
unnecessary for students to worry about copying diagrams or algebra during lectures,
enabling them to concentrate on the ideas rather than the technical details.
The
lecture notes are a supplement to rather than a replacement for the texts.
Problem sets:
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 Fall '07
 KARP
 Economics, International Trade, The Land, trade theory

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