Содержание
- 2. GOALS OF CLASS This class examines international trade—why nations trade and why they sometimes place limits
- 3. INTERNATIONAL TRADE: IMPORTING AND EXPORTING International trade occurs when individuals, firms, or governments import or export
- 4. Most of America’s imports come from the industrialized nations of the world. In 1998 the United
- 5. The Commerce Department also reported that the United States exported about $683 billion worth of goods
- 6. Balance of Trade The balance of trade shows the relationship between the nation’s total merchandise imports
- 7. According to the Department of Commerce, in 1998 the United States had its largest trade deficits
- 8. The United States has experienced merchandise trade deficits every year since 1975. These trade deficits have
- 9. There are many reasons for the U.S. trade deficits since the 1970s. One reason has been
- 10. Other foreign products have also made significant gains in U.S. markets including electronic equipment, textiles, and
- 11. Trade in Services In addition to trade in merchandise, nations also conduct trade in services. The
- 12. U.S. Trade in Goods and Services, 1990–1999 (in billions) Year Merchandise Trade Balance Services Trade Balance
- 13. Trade and Specialization So why do nations trade? Despite the trade deficits that the United States
- 14. From an economist’s perspective there’s another important reason for international trade—specialization promotes a more efficient use
- 15. The United States, in turn, can use its resources to grow crops more suited to its
- 16. A nation has an absolute advantage in the production of a good when it can produce
- 17. But suppose one nation has an absolute advantage over another nation in two products. Should trade
- 18. Economists say that Japan not only has an absolute advantage in the production of televisions, but
- 19. An important thing to remember is that the highly industrialized nations of the world—including Japan and
- 20. Suppose you have an excellent history teacher at school. And suppose that this history teacher can
- 21. Trade and Exchange Rates When nations specialize in the production of certain goods, they do so
- 22. Nations use an exchange rate to determine the worth of one currency against other currencies. The
- 23. To read the exchange rates, consider the following example. Suppose you planned to travel to France
- 24. But suppose a friend of yours from France came to visit you in the United States.
- 25. On a larger scale, U.S. firms that do business in other countries can calculate very precisely
- 26. A flexible exchange rate allows the forces of supply and demand to determine the value of
- 27. If the demand for the U.S. dollar decreased in foreign exchange markets, however, the value of
- 28. Managed exchange rates involve government intervention in foreign exchange markets. By purchasing large quantities of a
- 29. BARRIERS TO TRADE Barriers to trade are government actions that are designed to reduce or even
- 30. Tariffs: A tariff is a federal tax on an imported good. The Constitution gives the federal
- 31. The effect of these tariffs was to reduce the quantity demanded of some Japanese motorcycles and
- 32. Quotas: A quota sets a specific limit on the amount of a good that can be
- 33. Embargoes: An embargo occurs when a government cuts off some or all trade with another nation.
- 34. Voluntary restraints: Voluntary restraints limit the quantity of a good that can be imported. While the
- 35. Other restrictions: There are a variety of additional ways that nations can restrict or prevent trade
- 36. PROTECTIONISM: PRO AND CON Protectionism is the government’s use of trade barriers to limit foreign imports.
- 37. Infant Industries Argument Protectionists believe that newer industries, called infant industries, need government protection from more
- 38. Employment Argument Protectionists argue that trade barriers protect domestic jobs and the wages of domestic workers.
- 39. Supporters of freer trade counter that millions of U.S. laborers work in export industries and, thus,
- 40. The Dumping Argument Protectionists argue that trade barriers or other restrictions are necessary to prevent dumping.
- 41. Thus, the fairest way to deal with dumping is to slap high tariffs on these goods
- 42. Selfsufficiency Argument Protectionists argue that a nation must not become too dependent on other nations for
- 43. Included in this list are items produced by the defense industry, such as missiles, fighter aircraft,
- 44. PROMOTING FREER TRADE Since World War II the degree of international cooperation between nations to promote
- 45. International Trade Agreements The most important postWorld War II international trade agreement was the 1947 General
- 46. GATT provided a forum for members—called “contracting parties”—to discuss trade barriers and trade disputes. From 1947
- 47. The WTO expanded on GATT’s central mission by promoting freer trade not only in manufactured goods
- 48. The United States, for example, bowed to a WTO committee decision to lift its trade restrictions
- 49. Regional Trade Organizations Another major development toward freer international markets in the postWorld War II era
- 50. Membership in the EU has strengthened the position of member nations in trade relations with other
- 51. Another important regional trade organization is The North American Free Trade Agreement, or NAFTA. NAFTA took
- 52. Other regional trade organizations around the world are also working to integrate their economies and increase
- 53. MAKING ECONOMIC DECISIONS: FAST TRACK TRADE AUTHORITY Fast track trade authority gives the President the authority
- 54. Supporters of fast track trade authority argue that this process is quicker and more efficient than
- 55. Opponents of fast track trade authority argue that fast track trade authority places too much power
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Слайд 2GOALS OF CLASS
This class examines international trade—why nations trade and why they
GOALS OF CLASS
This class examines international trade—why nations trade and why they
In the 1990s the rise of regional trade associations has helped reduce trade barriers among participating nations. There is still considerable debate about what type of trade policy the United States should have, however. The record breaking U.S. trade deficits of the late 1990s intensified the debate between those who favor freer trade and those who favor protectionism.
Слайд 3INTERNATIONAL TRADE: IMPORTING AND EXPORTING
International trade occurs when individuals, firms, or governments
INTERNATIONAL TRADE: IMPORTING AND EXPORTING
International trade occurs when individuals, firms, or governments
Imports and Exports
According to the Bureau of the Census, the United States imported about $1,030 billion worth of goods in 1999. What types of goods does the United States import? The largest single category of imports is capital goods, including different kinds of machinery and equipment (29%), important imports include industrial supplies and materials (16,6%), automobiles and auto parts (16%), and petroleum and related petroleum products (8,2%) Other (30,2%).
Слайд 4Most of America’s imports come from the industrialized nations of the world.
Most of America’s imports come from the industrialized nations of the world.
Слайд 5The Commerce Department also reported that the United States exported about $683
The Commerce Department also reported that the United States exported about $683
Слайд 6Balance of Trade
The balance of trade shows the relationship between the nation’s
Balance of Trade
The balance of trade shows the relationship between the nation’s
When the value of a nation’s imports are greater than the value of its exports, the nation has a merchandise trade deficit.
This is because the nation is paying more money out to other nations to buy their goods than it is receiving from these nations.
When a nation has a trade deficit, economists say that it has a “negative balance of trade.”
Слайд 7According to the Department of Commerce, in 1998 the United States had
According to the Department of Commerce, in 1998 the United States had
Слайд 8The United States has experienced merchandise trade deficits every year since 1975.
The United States has experienced merchandise trade deficits every year since 1975.
The average merchandise trade deficit in the 1970s was about $10 billion per year, in the 1980s was $94 billion, and in the 1990s had grown to $173 billion per year.
Слайд 9There are many reasons for the U.S. trade deficits since the 1970s.
There are many reasons for the U.S. trade deficits since the 1970s.
Another reason for U.S. trade deficits has been the success of foreign products in key U.S. markets. Automobiles, for example, accounted for less than 5% of U.S. imports in 1965, or about $1 billion. By 1997 autos accounted for 16% of all U.S. imports, or a staggering $141 billion.
Слайд 10Other foreign products have also made significant gains in U.S. markets including
Other foreign products have also made significant gains in U.S. markets including
What does this mean for American exporters? It means that fewer U.S. goods will sell abroad because both money and confidence are in short supply.
Слайд 11Trade in Services
In addition to trade in merchandise, nations also conduct trade
Trade in Services
In addition to trade in merchandise, nations also conduct trade
War II. A trade surplus in services occurs when the value of services exported from a nation is greater than the value of services imported by the nation. During the 1990s the United States enjoyed an average trade surplus in services of about $67 billion per year. Included are financial services such as banking and insurance, telecommunications, tourism, and so on. U.S. trade surpluses for the 1990s are shown in Figure
Слайд 12
U.S. Trade in Goods and Services, 1990–1999 (in billions)
Year Merchandise Trade
U.S. Trade in Goods and Services, 1990–1999 (in billions)
Year Merchandise Trade
Balance
Trade Balance in Goods and Services
1990 −$109 +$28 −$81
1991 −$74 +$43 −$31
1992 −$96 +$59 −$37
1993 −$133 +$63 −$70
1994 −$166 +$68 −$98
1995 −$174 +$76 −$98
1996 −$191 +$87 −$104
1997 −$197 +$92 −$105
1998 −$247 +$83 −$164
1999 −$347 +$76 −$271
Слайд 13Trade and Specialization
So why do nations trade? Despite the trade deficits that
Trade and Specialization
So why do nations trade? Despite the trade deficits that
Слайд 14From an economist’s perspective there’s another important reason for international trade—specialization promotes
From an economist’s perspective there’s another important reason for international trade—specialization promotes
Слайд 15The United States, in turn, can use its resources to grow crops
The United States, in turn, can use its resources to grow crops
The United States specialized in the production of these crops because its climate and soil suited the production of these crops. Some corn and soybeans were sold within the United States, and the rest were exported to other nations.
Слайд 16A nation has an absolute advantage in the production of a good
A nation has an absolute advantage in the production of a good
What we are really saying is that the United States can produce a greater quantity of corn and soybeans, using fewer resources, than Brazil can produce. Brazil can produce a greater quantity of coffee, using fewer resources, than the United States can. The benefits of trade are clear in this situation. Each nation would benefit from specializing in the crop or crops it produces most efficiently, and then trading its surplus to the other.
Слайд 17But suppose one nation has an absolute advantage over another nation in
But suppose one nation has an absolute advantage over another nation in
in the production of televisions where it is three times as efficient as the Philippines. Japan is only twice as efficient as the Philippines in the production of VCRs.
Слайд 18Economists say that Japan not only has an absolute advantage in the
Economists say that Japan not only has an absolute advantage in the
Japan’s comparative advantage in this hypothetical case is in the production of televisions because Japan can produce three times a (compared to just two times as many VCRs). The Philippines, on the other hand, has a comparative advantage in the production of VCRs and, thus, should produce VCRs. This is because the size of its ‘‘disadvantage” is smaller in the production of VCRs than it is in televisions.
Слайд 19An important thing to remember is that the highly industrialized nations of
An important thing to remember is that the highly industrialized nations of
This discussion of absolute and comparative advantage may seem abstract, and difficult to follow. But consider a more personal example.
Слайд 20Suppose you have an excellent history teacher at school. And suppose that
Suppose you have an excellent history teacher at school. And suppose that
Слайд 21Trade and Exchange Rates
When nations specialize in the production of certain goods,
Trade and Exchange Rates
When nations specialize in the production of certain goods,
Without a mechanism for converting one currency into an equivalent value of another, international trade would be nearly impossible.
Слайд 22Nations use an exchange rate to determine the worth of one currency
Nations use an exchange rate to determine the worth of one currency
When exchange rates are published in the newspaper they usually list the name of the country, the name of the currency, the value of the foreign currency compared to the U.S. dollar (U.S. equivalent), and the value of the U.S. dollar compared to the foreign currency (currency per U.S. dollar).
Слайд 23To read the exchange rates, consider the following example. Suppose you planned
To read the exchange rates, consider the following example. Suppose you planned
Слайд 24But suppose a friend of yours from France came to visit you
But suppose a friend of yours from France came to visit you
Слайд 25On a larger scale, U.S. firms that do business in other countries
On a larger scale, U.S. firms that do business in other countries
Слайд 26A flexible exchange rate allows the forces of supply and demand to
A flexible exchange rate allows the forces of supply and demand to
Слайд 27If the demand for the U.S. dollar decreased in foreign exchange markets,
If the demand for the U.S. dollar decreased in foreign exchange markets,
Слайд 28Managed exchange rates involve government intervention in foreign exchange markets. By purchasing
Managed exchange rates involve government intervention in foreign exchange markets. By purchasing
Слайд 29BARRIERS TO TRADE
Barriers to trade are government actions that are designed to
BARRIERS TO TRADE
Barriers to trade are government actions that are designed to
Слайд 30Tariffs:
A tariff is a federal tax on an imported good. The
Tariffs:
A tariff is a federal tax on an imported good. The
Слайд 31The effect of these tariffs was to reduce the quantity demanded of
The effect of these tariffs was to reduce the quantity demanded of
In 1999 the United States imposed 100% tariffs on 15 categories of European luxury goods—including some Italian cheeses and British cashmere sweaters—to protest European trade restrictions that were placed on Latin American bananas that U.S. firms distribute in European markets. U.S. tariffs on Japanese and Brazilian steel were also approved by Congress in 1999.
Слайд 32Quotas: A quota sets a specific limit on the amount of a
Quotas: A quota sets a specific limit on the amount of a
Слайд 33Embargoes: An embargo occurs when a government cuts off some or all
Embargoes: An embargo occurs when a government cuts off some or all
In the early 1960s, for example, the United States placed an embargo on virtually all trade with the nation of Cuba to protest the creation of a communist government in Cuba under Fidel Castro’s leadership. In 1980 the United States placed an embargo on the sale of U.S. wheat to the Soviet Union to protest the 1979 Soviet invasion of neighboring Afghanistan. In 1985 the U.S. embargo of certain high-tech products to South Africa was an attempt to pressure the South African government to end its racist apartheid policies. More recently, in 1999 the United States was joined by many other nations in its embargo against the repressive Yugoslavian regime to halt the slaughter of ethnic Albanians in the province of Kosovo.
Слайд 34Voluntary restraints: Voluntary restraints limit the quantity of a good that can
Voluntary restraints: Voluntary restraints limit the quantity of a good that can
Слайд 35Other restrictions: There are a variety of additional ways that nations can
Other restrictions: There are a variety of additional ways that nations can
By mid1999 a series of compromises were being explored to end the ban. Another trade barrier is government limits on the number of import licenses that are issued to firms. Firms need an import license to bring goods into a nation. If the government limits the number, or creates other obstacles to obtaining import licenses, the result is fewer imports.
Слайд 36PROTECTIONISM: PRO AND CON
Protectionism is the government’s use of trade barriers to
PROTECTIONISM: PRO AND CON
Protectionism is the government’s use of trade barriers to
Слайд 37Infant Industries Argument
Protectionists believe that newer industries, called infant industries, need government
Infant Industries Argument
Protectionists believe that newer industries, called infant industries, need government
Слайд 38Employment Argument
Protectionists argue that trade barriers protect domestic jobs and the wages
Employment Argument
Protectionists argue that trade barriers protect domestic jobs and the wages
Слайд 39Supporters of freer trade counter that millions of U.S. laborers work in
Supporters of freer trade counter that millions of U.S. laborers work in
Слайд 40The Dumping Argument
Protectionists argue that trade barriers or other restrictions are necessary
The Dumping Argument
Protectionists argue that trade barriers or other restrictions are necessary
Слайд 41Thus, the fairest way to deal with dumping is to slap high
Thus, the fairest way to deal with dumping is to slap high
Free traders believe that the benefits of competition—efficiency in production and lower prices for consumers—should make us weary of “crying foul” every time a foreign good sells well in the American market.
Слайд 42Selfsufficiency Argument
Protectionists argue that a nation must not become too dependent on
Selfsufficiency Argument
Protectionists argue that a nation must not become too dependent on
Слайд 43Included in this list are items produced by the defense industry, such
Included in this list are items produced by the defense industry, such
Слайд 44PROMOTING FREER TRADE
Since World War II the degree of international cooperation between
PROMOTING FREER TRADE
Since World War II the degree of international cooperation between
Слайд 45International Trade Agreements
The most important postWorld War II international trade agreement was
International Trade Agreements
The most important postWorld War II international trade agreement was
Слайд 46GATT provided a forum for members—called “contracting parties”—to discuss trade barriers and
GATT provided a forum for members—called “contracting parties”—to discuss trade barriers and
Слайд 47The WTO expanded on GATT’s central mission by promoting freer trade not
The WTO expanded on GATT’s central mission by promoting freer trade not
of China, which, by 1999, had gained the support of the Clinton Administration for admission, and which had opened formal negotiations with the European Union (EU) in January of 2000 to solicit its support. The WTO’s members must extend trade concessions given to one nation to all member nations. Member nations are also required to abide by the decisions of WTO review committees if trade disputes arise.
Слайд 48The United States, for example, bowed to a WTO committee decision to
The United States, for example, bowed to a WTO committee decision to
Слайд 49Regional Trade Organizations
Another major development toward freer international markets in the postWorld
Regional Trade Organizations
Another major development toward freer international markets in the postWorld
The EU was founded in 1993 by the Maastricht Treaty. It replaced the 12nation European Community (EC), and expanded on the EC’s mission to create a ‘‘freetrade zone” in Europe. A freetrade zone is an economic region that does not restrict trade or investments among member nations. The 15 members of the EU include Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the United Kingdom.
Слайд 50Membership in the EU has strengthened the position of member nations in
Membership in the EU has strengthened the position of member nations in
Other nations currently negotiating to join the EU include Cyprus, the Czech Republic, Estonia, Hungary, Poland, and Slovenia.
Слайд 51Another important regional trade organization is The North American Free Trade Agreement,
Another important regional trade organization is The North American Free Trade Agreement,
The most important goals of NAFTA are to promote free trade and economic growth in its member nations. In the first five years of NAFTA, trade between member nations has increased by about 75%, from $289 billion in 1993 to over $500 billion by 1999.
Слайд 52Other regional trade organizations around the world are also working to integrate
Other regional trade organizations around the world are also working to integrate
Formal discussions among the NAFTA and MERCOSUR nations, along with a number of other Latin American nations, began in the late 1990s to form a Free Trade Area of the Americas (FTAA) by 2005.
Among the other regional trade organizations currently operating are the Association of Southeast Asian Nations (ASEAN), the AsiaPacific Economic Cooperation group (APEC), and the European Free Trade Agreement (EFTA).
Слайд 53 MAKING ECONOMIC DECISIONS: FAST TRACK TRADE AUTHORITY
Fast track trade authority gives
MAKING ECONOMIC DECISIONS: FAST TRACK TRADE AUTHORITY
Fast track trade authority gives
During the 1990s, for example, fast track negotiations resulted in the creation of NAFTA (1993) and the U.S. approval of trade policies from the Uruguay Round of GATT (1994).
Слайд 54Supporters of fast track trade authority argue that this process is quicker
Supporters of fast track trade authority argue that this process is quicker
Слайд 55Opponents of fast track trade authority argue that fast track trade authority
Opponents of fast track trade authority argue that fast track trade authority
Thus, opponents have severe reservations about how much power fast track trade authority takes out of the hands of their elected officials and places in the hands of bureaucrats.