Review Sheet 1

Review Sheet 1 - Economics 161 Spring 2011 Global...

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Economics 161 — Spring 2011 Global Integration of Latin America Review Sheet 1: Trade Integration April 1, 2010 Instructor: Marc-Andreas Muendler E-mail: 1 Import Substitution Industrialization For what motives and when did Latin America pursue Import Substitution Industrialization (ISI)? Outline three arguments in favor of ISI. What were key objectives of ISI? Argue for or against the success of ISI with regard to those objectives. There are alternative policies to ISI that might achieve key objectives differently. Argue for or against their possible success in Latin America. 2 Trade Agreements Regional and bilateral trade agreements may complement or conflict with mul- tilateral trade agreements. 1. With what rationale does the World Trade Organization support the pro- motion of regional trade agreements? 2. Discern between trade creation and trade diversion and explain how trade agreements may create or divert trade. 3. A narrow argument for protectionism is that trade restrictions may im- prove a large economy’s terms of trade. Assess to what extent regional or multilateral trade agreements can resolve the coordination problem of protectionism. 3 Trade Patterns and Gains from Trade The Ricardian and Heckscher-Ohlin theories of international trade stress differ- ent aspects of comparative advantage . [You may use numeric examples, graphs, or clear verbal arguments for any of your answers.] 1. Discuss prime differences between the Ricardian and the Heckscher-Ohlin theory of trade. State their main predictions for the pattern of trade.
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This note was uploaded on 08/14/2011 for the course ECON 161 taught by Professor Muendler during the Spring '11 term at San Diego.

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Review Sheet 1 - Economics 161 Spring 2011 Global...

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