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Course Name (English)
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INTERNATIONAL ECONOMICS
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| Course Code |
ECO561 |
| Course Description |
This course examines and analyses the theories of international trade, trade activities of a nation, monetary systems, economic integration and policies. The area of study also includes discussion on current international economic issues and development. |
| Transferable Skills |
Ethically and Socially Sensitive |
| Teaching Methodologies |
Lectures, Discussion, Presentation |
| CLO |
| CLO1 |
Explain concepts and theories of international economics. |
| CLO2 |
Analyze international economic interactions in decision making. |
| CLO3 |
Demonstrate autonomous learning in international trade policies in global economy. |
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| Pre-Requisite Courses |
No course recommendations |
| Topics |
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1. Introduction
1.1) 1.1 Globalization of the World Economy
1.2) 1.2 Gravity model
1.3) 1.3 International Economic Problems and Challenges
1.4) 1.4 Benefits of Trade
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2. The Law of Comparative Advantage
2.1) 2.1 Mercantilism
2.2) 2.2 Adam Smith Theory of Absolute Advantage
2.3) 2.3 David Ricardo Theory of Comparative Advantage
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3. The Standard Theory of International Trade
3.1) 3.1 Production Frontiers - Increasing Costs
3.2) 3.2 Indifference Curves
3.3) 3.3 Equilibrium in Isolation- Gains from Trade
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4. Factor Endowment and the Heckscher-Ohlin Theory
4.1) 4.1 Factor intensity, factor abundance and shape of PPF
4.2) 4.2 General equilibrium framework
4.3) 4.3 Heckscher-Ohlin Theorem
4.4) 4.4 Factor-Price Equalization Theorem
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5. Economies of Scale, Imperfect Competition and International Trade
5.1) 5.1 Economies of Scale
5.2) 5.2 Product Differentiation and Intra-Industry Trade
5.3) 5.3 Technological Gap and Product Cycle Models
5.4) 5.4 Transportation Costs and Environmental Standards
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6. Trade Restriction (*)
6.1) 6.1 Tariffs
6.2) 6.2 Nontariff Barriers
6.3) 6.3 Arguments for and against Protectionism
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7. Economic Integration
7.1) 7.1 Degree of Economic Integration
7.2) 7.2 Trade Creation
7.3) 7.3 Trade Diversion
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8. International Resource Movements and MNCs
8.1) 8.1 Motives for International Capital Flows
8.2) 8.2 Portfolio Investment and Direct Investment
8.3) 8.3 Determinants of FDI
8.4) 8.4 Multinational Corporations – reasons for existence, problems created in home and host country
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9. Foreign Exchange Markets and Exchange Rates
9.1) 9.1 Functions of Foreign Exchange Market
9.2) 9.2 Types – Fixed, Floating and Managed-Floating Systems
9.3) 9.3 Factors Affecting Exchange Rates
9.4) 9.4 Advantages and Disadvantages of Flexible and Fixed ER System
9.5) 9.5 Spot and Forward Rates, Currency Swaps, Hedging and Speculation (Concept)
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10. Price Adjustment Mechanism with Flexible & Fixed ER
10.1) 10.1 Balance of Payments accounts
10.2) 10.2 Balance of Payments Adjustments with ER Changes
10.3) 10.3 Gold Standard
10.4) 10.4 Price-Specie Flow Mechanism
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11. Open-Economy Macroeconomics: Adjustment Policies
11.1) 11.1 Expenditure-Changing Policies
11.2) 11.2 Expenditure-Switching Policies
11.3) 11.3 Direct Control
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| Assessment Breakdown | % |
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| Continuous Assessment | 60.00% |
| Final Assessment | 40.00% |
| Details of Continuous Assessment |
| Assessment Type |
Assessment Description |
% of Total Mark |
CLO |
| Assignment |
Individual Assessment 2: Report and video presentation (20%) |
20% |
CLO3
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| Assignment |
Individual Assessment I : (Question type: case study/ structured, MCQ, T/F, fill-in the blanks) - 30% |
30% |
CLO3
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| Test |
Chap 2 & 5; (Question type: case study, MCQ, True/False, fill in the blanks & structured) |
10% |
CLO1
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| Reading List | | Recommended Text | - Robert J. Carbaugh, International Economics, Thomson South Western Publishing
- Thomas A. Pugel, International Economics, McGraw Hill
- Paul R. Krugman and Maurice Obstfeld, International Economics: Theory and Policy, Prentice Hall
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| Reference Book Resources | - Dominick Salvatore 2014, International Economics, 11 Ed., Wiley
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| Article/Paper List | This Course does not have any article/paper resources |
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| Other References | - Websites of WTO, AFTA and EU History of formation, objectives and
progress or the relevant economic blocs.
- Ministry of International Trade and Industry Tariffs and NTBs in Malaysia
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