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1、CHAPTER3WhyEverybodyTrades:ComparativeAdvantageandFactorProportions1outlineMercantilismAbsoluteadvantagetheoryComparativeadvantagetheoryFactorendowmenttheory(Heckscher—OhlintheoryH-Otheory)2ThebriefclassificationoftradetheoryClassicaltheory(perfectcompetition,const
2、antreturn)AbsoluteadvantagetheorycomparativeadvantagetheoryNeo-classicaltheory(perfectcompetition)H-Otheoryandtherelevanttheory3ThebriefclassificationoftradetheoryNewtradetheory(imperfectcompetition)New-newtradetheoryPaymuchattentiontomicroenterprisessituationandit
3、scompetitiveness/4generalequilibrium &partialequilibriumgeneralequilibrium:consideringallmarketsinaneconomysimultaneously,allmarketsmustbeinequilibriumPartialequilibrium:somepartsoftheeconomyisconsidered,neglectingwhatishappeninginothermarket.5ToolsforGeneralequili
4、briumanalysis:production-possibilitycurve(PPC)andindifferencecurveToolsforpartialequilibriumanalysis:demandcurveandsupplycurve6mercantilismTheoldesttheoryaboutinternationaltradeThemainpointofviews:Thenationalwealthwasbasedonnationalholdingsofgoldandsilver.Exportisa
5、sourceofnationalbenefitsTradewasazero-sumactivity—onecountrygainscomeattheexpenseofsomeothercountries.7mercantilismThegovernmentpolicyImposetaxesandbarrierstolimitimportSubsidizeandencourageexportNowadays,thethinkingisstillaliveingovernments,especiallyforsomespecia
6、l-interestgroups8AbsoluteadvantageAdamSmiththefatherofeconomicswealthofnation17669AbsoluteadvantageLaborProductivity:thenumberofunitsofoutputthataworkercanproduceinonehourSpecilizationcanimprovetheproductivity.Absoluteadvantage:Ifonecountryhashigherproductivityinth
7、eproductionofcurtaingoods,itholdsabsoluteadvantageinthisgoods.10ThepointsofAbsoluteAdvantageOnecountryshouldconcentrateontheproductionofthegoodsthatithasabsoluteadvantageandexportthem,thenimportthegoodsthatitdonothaveabsoluteadvantage,thenbothcountrycanbenefitfromt
8、hespecificationandtrade11TheresultoftradeGlobalproductionefficiencyisenhancedbecausetradeallowseachcountrytoexploititsabsoluteadvantageinproducin
