Assignment title: Analysis of International Trade Theories and Their Application to Current International Trade Practices

This assessment (Assignment) has covered Learning Outcome Two (LO-2) [30% of the final marks]: Students will critically analyse international trade theories and apply them to current international trade practices.

Learning Outcome 2

Students will critically analyse international trade theories and apply them to current international trade practices.

• Theory of absolute and comparative advantage

• Factors endowment, trade and income distribution

• Hecksher-Ohlin model

• Stolper-Samuelson model

• Context of new trade theories

• Economies of scale

• Imperfect competition and market power

All students note the following conditions:

1. Students must choose two countries approved by the lecturer before they start writing the assignment.

2. Each student must select two different countries for his/her assignment. This ensures that we do not have plagiarism where students copy someone else’s assignment topic.

3. Students must conduct research to write this assignment.

4. This assignment is designed to use actual data from the secondary sources. Therefore, students must clearly write all sources of data for the verification purpose. If students use false/fake information/data, they will be given zero marks for this assignment.

5. The lecturer will help students search data for this assignment.

The objectives of the assignment are to:

• ensure students have adequate knowledge of the basic and major concepts in the field of international economics

• develop students’ analytical capability

• develop students’ ability to apply their theoretical knowledge

• develop students’ literature research skills

• refine students’ skills in accessing, managing and analysing information

• develop students’ written communication skills

• encourage students to take ownership of their own learning

Assignment writing guideline and instructions:

Students must write the assignment using the following structure. Copy only the bold headings to your assignment. Do not write the italic instructions or information.

Title: Analysis of International Trade Theories and Their Application to Current International Trade Practices

Name of the student:

Student ID number:

1. Introduction (total 5 marks)

• Why country trade [3 marks]

• Objective of your study [1 mark]

• Structure of your study [1 mark]

2. Trade structure of your chosen countries (total 6 marks)

• Analysis [4 marks]

• Data table [2 marks]

Data table must include the following information in 20xx

Table 1: Basic economic indicators and trade structure of C1 and C2 in 20xx

Country 1 Country 2

Land area (sq. km.) Land area (sq. km.)

GDP (current USD, millions) GDP (current USD, millions)

GNI per capita (current USD) GNI per capita (current USD)

Total Trade (X+M) (current USD, millions) Total Trade (X+M) (current USD, millions)

Total exports (current USD, millions) Total exports (current USD, millions)

Total Imports (current USD, millions) Total Imports (current USD, millions)

Trade to GDP ratio (%) Trade to GDP ratio (%)

Share of exports (%)

Agricultural products Agricultural products

Fuels and mining products Fuels and mining products

Manufactures Manufactures

Share of imports (%)

Agricultural products Agricultural products

Fuels and mining products Fuels and mining products

Manufactures Manufactures

Source:

3. Absolute advantage and comparative advantage (18 marks)

(a) Absolute advantage (9 marks)

• Analysis of absolute advantage of country-1 and country-2 [7 marks]

• Data Table [2 marks]

Students must select 5 agricultural products with the highest average yield for country 1 and then select same 5 products for country 2. Selected 5 products must be the same for both countries for comparison. Data table must include the following information in 20xx:

Table 2: Production: five selected agricultural products of C1 and C2 in 20xx

Country 1 Country 2

Product Total production (tone) Yield (kg/hectare) Total production (tone) Yield (kg/hectare)

Product 1 (e.g., Apple) Product 1 (Apple)

Product 2 (e.g. Orange) Product 2 (Orange)

Product 3 Product 3

Product 4 Product 4

Product 5 Product 5

Source:

(b) Comparative advantage (9 marks)

• Analysis of comparative advantage of country-1 and country-2 [6 marks]

• Data Table [3 marks]

Students must select 5 products with the lowest producer price for country. Selected 5 products may not be the same for both countries. Data table must include the following information in 20xx:

Table 3: Producer price: five selected products of C1 and C2 in 20xx

Country 1 Country 2

Product Price per unit, USD) Price per unit, USD)

Product 1 Product 1

Product 2 Product 2

Product 3 Product 3

Product 4 Product 4

Product 5 Product 5

Source:

4. Factor endowment, trade and income distribution (total 12 marks)

(a) Hecksher-Ohlin (H-O) model [8 marks]

• Analysis of H-O model for country-1 and country-2 [6 marks]

• Data table [2 marks]

Data table must include the following information in 20xx:

Table 4: Factor endowment and pattern of trade of C1 and C2 in 20xx

Country 1 Country 2

Factors Factors

Agricultural Land (million hectares) Agricultural Land (million hectares)

Agricultural Land (% of land area) Agricultural Land (% of land area)

Labour (millions) Labour (millions)

Capital (USD, millions) Capital (USD, millions)

Five major exported products Five major imported products Five major exported products Five major imported products

Product 1 Product 1 Product 1 Product 1

Product 2 Product 2 Product 2 Product 2

Product 3 Product 3 Product 3 Product 3

Product 4 Product 4 Product 4 Product 4

Product 5 Product 5 Product 5 Product 5

Source:

(b) Stolper-Samuelson (S-S) model [4 marks]

• Analysis of S-S model for country-1 and country-2 [4 marks]

Students should use information from previous data tables to answer this part.

Context of new trade theories (total 12 marks)

(a) Economies of scale [7 marks]

• Analysis of economics of scale for country-1 and country-2 [4 marks]

• Data table [3 marks]

Students must consider the same 5 agricultural products for country 1 selected in Table 2. Similarly, they must select 5 agricultural products with the highest volume of output for country 2. Selected 5 products may not be the same for both countries. Data table must include the following information in 20xx:

Table 5: domestic consumption and export: five selected agricultural products of C1 and C2 in 20xx

Country 1 Country 2

Product Domestic consumption (tone) Exports (tone) Domestic consumption (tone) Exports (tone)

Product 1 Product 1

Product 2 Product

Product 3 Product 3

Product 4 Product 4

Product 5 Product 5

Source:

(b) Imperfect competition and market power [5 marks]

• Analysis of imparpect competiton and market power of five top producing countries on one selected agricultural product [3 marks]

• Data table [2 marks]

Students must select any one agricultural product approved by the lecturer before they start writing the assignment. Then they select top five producing countries of that product. Data table must include the following information in 20xx:

Table 6: One selected agricultural product in 20xx

Agricultural product name:

Top five producing/exporting countries Volume of production (tone) Share of world production (%)

Country 1

Country 2

Country 3

Country 4

Country 5

Source:

Conclusion (total 5 marks)

• Students must use own words and sum up findings of the whole assignment covering from section 2 to section 5.

References (total 2 marks)

• Students must use APA referencing as per instruction.

• They must write full reference here.