[...]... existence Why international economics is a separate field International trade theory and domestic microeconomics both rest on the same assumption that economic agents maximize their own self-interest Nevertheless, there are important differences between domestic and foreign transactions Similarly, international finance is closely tied to domestic macroeconomics, but political borders do matter, and international. .. Domestic and international equilibrium Domestic equilibrium with a balance-of-payments deficit Balance-of-payments adjustment under specie flow Payments adjustment through monetary policy Payments adjustment through a tightening of fiscal policy Comparing the effects of fiscal and monetary policies Adjustment of a payments deficit through expansionary fiscal policy Internal and external balance Balance-of-payments... country In contrast, tariffs, quotas, 8 International economics 3 4 and other government-imposed barriers to trade are almost universal in international trade A large part of international trade theory deals with why such barriers are imposed, how they operate, and what effects they have on flows of trade and other aspects of economic performance Domestic macroeconomics normally deals with monetary and... a detailed index is intended to make this book useful to readers long after a course in international economics has been completed This book is designed for students whose previous exposure to economics has been limited to a two-semester principles course, but it also attempts to teach the theory of international economics with some rigor Each chapter begins with a statement of learning objectives to... book for a full-year course can cover the entire volume and assign a supplementary book of readings Those who choose to use this book for a onesemester (or one-quarter) course will probably want to eliminate some chapters The core chapters are 2 through 7, and 12 through 19 For a one-semester chapter emphasizing trade, Chapters 1 through 11 provide a compact, self-contained, unit For a one-term course... curve The effects of a tariff: partial equilibrium, small-country case The effect of an import quota The effect of a subsidy: partial equilibrium, small-country case The effect of a tariff: partial equilibrium, large-country case The effects of a tariff: general equilibrium, small-country case The effects of a tariff: general equilibrium, large-country case The effect of an export subsidy The effect... The terms-of-trade effects of growth: offer curve analysis An overview of developing-country trade Measuring economic development: the NIKE index Trade in toxic waste Wealth of the Irish Gold as a reserve asset The Bic Mac index Modeling the monetarist view of the balance of payments Printing the budget deficit as a route to inflation The IS/LM/BP graph as a route to understanding balance-of-payments... area such as international economics, and we have consequently prepared a sixth edition The book covers the standard topics in international economics Each of the two main parts, International Trade and Trade Policy (Part One) and International Finance and Open Economy Macroeconomics (Part Two), develops the theory first, and then applies it to recent policy issues and historical episodes This approach... Some of the tools of intermediate microeconomics and macroeconomics are presented in the text and are used to treat international issues Offer curves and Edgeworth boxes are introduced in the trade theory chapters, and the IS–LM model, modified to include the balance of payments, is taught in the international finance chapters These analytical tools are treated in self-contained sections separate from the... • the extent to which international trade in goods and services and international capital flows have increased more rapidly than output over the past several decades for the world as a whole; why barriers to the free flow of goods, labor, and capital are central to the study of international trade; why separate currencies and national business cycles are central to the study of international finance; . York, NY 10001 Routledge is an imprint of the Taylor & Francis Group © 2004 Robert M. Dunn & John H. Mutti All rights reserved. No part of this book may be reprinted or reproduced or. summaries, this impressive clearly written book will be another winner with students of international economics and international business. Robert M. Dunn, Jr is Professor of Economics at the George. form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission