Econ 333 Lecture Notes

Econ 333 Lecture Notes - Econ 333 Chapter 6: International...

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Econ 333 Chapter 6: International Factor Movements
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What if… Labor and capital can move between countries! Look at regions—Michigan is losing jobs as companies close car assembly plants New plants are opening in Southern states If you were an auto assembly worker, would you move? What about the machines and buildings?
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If factors want to move but A large wall prevents workers from entering the country, is production in the combination of both countries more, less, or the same? What if companies in one country are not allowed to build factories in the other country either?
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Trade in Goods versus Trade in Factors International Trade usually refers to goods and services To make world production and consumption highest, both goods and factors need to be able to move Blocking either type is less efficient (will lower world production)
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How does Capital Move? Financial Capital Foreign Exchange Markets support trading (Need Euros to buy goods and services in Europe) Chapter 13: Portfolios and Investments Foreign Direct Investment (FDI): People in
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This note was uploaded on 09/23/2009 for the course ECON 333 taught by Professor Roberts during the Spring '09 term at Ill. Chicago.

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Econ 333 Lecture Notes - Econ 333 Chapter 6: International...

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