中山大学国际贸易理论讲义.ppt

CHAPTER 2LABOR PRODUCTIVITY AND COMPARITIVE ADVANTAGE: THE RICARDIAN MODEL Huang Xinfei International Business School, Sun Yat-sen University The Classical Theory of Trade Early trade theories: Mercantilist, David Hume, and Adam Smith The classical world of David Ricardo and Comparative Advantage Extensions and tests of the Classical model of trade Early Trade Theories Mercantilism: 1500-1750 Main ideas Nation’s Wealth= Country’s holdings of precious metals Export is a gain (gain precious metals) Import is a loss (lose precious metals) Trade is a “Zero-sum Game”: one country gain is a loss of another country Policies Maintain a positive trade balance: export import Early Trade Theories The Challenge to Mercantilism Davis Hume: (1752) the Price-Specie-Flow Mechanism Several assumptions Quantity theory of money: Demand for traded goods is price elastic Demand for traded goods is price elastic Perfect competition (product and factor markets) Gold standard The Price-Specie-Flow Mechanism Early Trade Theories The Challenge to Mercantilism Adam Smith(1723-1790) 2?2?2 Model Full Employment Perfect Competition Constant return to Scale Difference in Technology? Difference in Productivity? Difference in Production cost? Difference in Commodity price Absolute advantage ?Specialization ?Positive-sum game Productivity and Commodity price The Concept of Comparative Advantage The case of winter roses Opportunity Cost The Classical World of David Ricardo David Ricardo(1772-1823) Basic Assumptions Unit costs of production are constant Full employment Perfect Competition Constant return to Scale No transportation costs and obstacles Mobility of the factors Labor theory of value Fixed endowment of resources Fixed level of technology A one-factor economy 2?2 model in the absence of international trade (autarky ) Production Possibilities unit labor requirement: aLC, aLW output :QC, QW : supply of the hours of labor : L Home’s Production