College Notes (Tutorials) Global Political Economy (5182V8GP)

Global Political Economy
compilation document
Contents
Tutorial 1 – 19-2 – International Trade..................................................................................................2
Tutorial 2 – 12-3 – International Finance, economic integration and policy dilemmas/trilemmas......11
Tutorial 3 – 23-4 – inequality...............................................................................................................26
Tutorial 4 – 21-5 – Environment and Economic growth......................................................................36




1

,Tutorial 1 – 19-2 – International Trade
Objectives of tutorial sessions

- Identify main theoretical and conceptual approaches in international economics and global
political economy and how they relate to policy making
- Critical assess, use and communicate the concepts and theories
- Develop academic skills

Tutorial topics

- Tutorial 1
o international trade
 What is the difference between an absolute and a comparative advantage?
 Should industrial policy in a country conform to the current comparative
advantage, or defy it?
 How different are the challenges of advanced and developing economies?
- Tutorial 2
o international finance, economic integration and policy dilemmas/trilemmas
 What policy constraints do states and economies face in liberalizing financial
flows?
 How do capital flows affect currencies?
 What or who stabilizes the international financial system, and at what
economic, political and social costs?
- Tutorial 3
o global inequality
 What causes inequality and how do we measure it?
 What national and international trends in wealth and income inequality can
we recognize?
 Is there a relationship between inequality levels and economic
performance?
- Tutorial 4
o environment and economic growth
 Is the current model of growth sustainable?
 Are inclusive growth and green growth good alternatives?
 Or is de-growth inevitable if we want to preserve our planet?
 Topics for essays

Argumentative essay

- One of the following general topics
o International trade
o International finance and policy dilemmas
o Economic inequality
o Economic growth and environment
o De-growth
- Centred on a main (original) argument, based on relevant academic debates
o reasonable and will informed people disagree
- Student’s position in the debate clearly indicated


2

, - The argument supported by relevant evidence
o from the literature or, where appropriate, by economic data
- Formal requirements
o 2000 words long
 10% margin
o Use at least 5 peer-reviewed academic sources
o Chicago style referencing
 author-date or footnote-bibliography
o Submitted one week after tutorial 4, using Turnitin on Brightspace
o Late submissions
 0.5 grade reduction per day late submission
o Has a title (summarizing the main argument), student name, student number, group
number, date of submission, paginated pages, bibliography
o Optional
 essay proposal one week before tutorial 4
 Feedback
- Learning objectives
o Critically assess and use main theoretical and conceptual approaches in international
economics and global political economy
o Practice your academic skills
 Research, analysis, how to organize and present your ideas
o Practice presenting a point of view in a structured, clear, well-reasoned way that
convinces others

Realms of the world economy

- International trade = exchange of both good and services between countries of the world
- International production = the production of products (and their intermediate inputs) in
multiple countries
- International finance = the exchange of assets between countries
- Larger realms
o CEPT
 Culture
 Environment
 Politics
 Technology

Trump lowered the taxes but gained more tax revenue because companies did not redirect their
taxes to other countries anymore

International trade

- Key concepts
o Specialization
o Comparative advantage
o Protection of infant industries
o First globalization and de-globalization
o Second globalization
 Trade liberalization, deregulation


3

,  Containerization
 International supply chains
 Tax avoidance

Discussion based on Reading Report 1

- What kind of trade policy would you advise to (a specific government in) your region of
specialization
o Should trade barriers be further decreased or increased?
- Klein and Pettis argue that global trade has transformed beyond recognition in the last fifty
years
o Which developments do you find most consequential?
- What would you expect to happen to global trade in the next ten years?
o Clearly list some predictions
 Also complemented by explanations

Absolute Advantage

- Absolute advantage = “If a foreign country can supply us with a commodity cheaper than we
ourselves can make it, better buy it of them with some part of the produce of our own
industry employed in a way in which we have some advantage”
o Adam Smith 1977, 424
- The ability of a country
o to produce a good or service with fewer real resources or inputs than another
country OR to produce more of a good or service with the same real resources or
inputs than another country
- A pattern of absolute advantage implies a potential pattern of trade
- The principle of absolute advantage is a policy suggestion that countries should import
goods from other countries where they are produced more efficiently

Trade in the rice market




 graph 47
o Consider Figure 2.3 above, and mention what is happening with the price, quantity
supplied, and quantity demanded in both Vietnam and Japan
 Vietnam
 Price and quantity supplied increase
 Quantity demanded decreases
 Exports rice
 Japan
 Price and quantity supplied decreases
 Quantity demanded increases


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