By the end of this module, students be able to: (i) apply concepts from microeconomic theory (partial and general equilibrium theory) to investigate how trade and output specialisation evolve and how this affects welfare; (ii) Appreciate the importance of different market structures in determining the welfare consequences of trade; (iii) Interpret the relationship between trade patterns, labour markets, and wage inequality; (iv) Analyse the rationale for trade policy and its effects. The module will allow students to engage with the current issues and debates around the role of globalisation and trade policy.
Course outline:
- Introduction and gravity equation
- Neoclassical theories of trade
- Returns to scale and firms in the global economy
- Trade policy