ECO 358 International Economics Professor Malamud BEH – 3294 Fax: 895 – Website: go to unlv homepage and follow links college / department / economics / faculty / malamud

Course objectives Familiarize you with the world economy and with economic issues encountered by international businesses. why nations trade with each other gains from trade the effects of barriers to trade the advantages and disadvantages of fixed and flexible exchange rates.

International Economics By Robert J. Carbaugh 8th Edition Powerpoint slides at Carbaugh Website: Follow links to Student Resources Resources / Powerpoint

Elements of international interdependence Trade : goods, services, raw materials, energy Finance : foreign debt, foreign investment, exchange rates Business : multinational corporations, global production Migration : flows of skilled workers, unskilled workers, family members

Exports of goods and services (percent of gdp, 1997) Country Exports, % of GDP Netherlands55% Norway41 Canada39 Mexico31 South Korea31 United Kingdom29 Germany25 France25 United States12 Japan10

Leading trading partners of the United States, 1997 Value of US Countryexports ($ bill.)imports ($ bill.) Canada$133$160 Japan68118 Mexico5576 United Kingdom3131 South Korea2718 China (incl. Hong Kong) 2564 Germany2340 Singapore1721 Belgium/Luxembourg137

Competitiveness & trade Objective: generate high and rising standard of living For Free – Trade No nation can efficiently make everything itself Trade allows nations to focus on what they make best Inefficient sectors are squeezed out Sectors open to competition become more efficient and productive

Globalization and poetry All are but parts of one stupendous whole, Whose body Nature is, and God the soul… Look round our World; behold the chain of Love Combining all below and all above. See plastic Nature working to this end, The single atoms each to other tend … Nothing is foreign; Parts relate to whole; One all-extending all-preserving Soul Connects each being, greatest with the least; Made Beast in aid of Man, and Man of Beast; All serv’d, all serving! Nothing stands alone; The chain holds on, and where it ends, unknown. Alexander Pope, Essay on Man, 1734

Globalization and Empire We are living at a period of most wondrous transition which tends rapidly to accomplish that great end to which all history points – the realization of the unity of mankind …The distances which separated the different nations and parts of the globe are rapidly vanishing before the achievements of modern invention, and we can traverse them with incredible ease … Thought is communicated with the rapidity, and even by the power, of lightning …The products of all quarters of the globe are placed at our disposal, and we have only to choose which is the best and cheapest for our purposes, and the powers of production are entrusted to the stimulus of competition and capitalism. Prince Albert, 1851

Globalization … and Peace What an extraordinary episode in the economic progress of man that age was which came to an end in August 1914! … Escape was possible, for any man of capacity, into the middle and upper classes, for whom life offered conveniences, comforts and amenities beyond the compass of the richest and most powerful monarchs of other ages. The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth; … he could at the same moment adventure his wealth in the natural resources and new enterprises of any quarter of the world, and share in their prospective fruits and advantages;or he could decide to couple his fortune with the good faith of the townspeople of any substantial municipality in any continent … etc., etc. John Maynard Keynes, Economic Consequences of the Peace, 1920.

Jihad vs McWorld McWorld … as seen by its detractors The City … Babylon Commerce Mixed populations Artistic freedom Sexual license Wealth Arrogance Power The Bourgeois Materialism Liberalism Personal safety Reason Empirical inquiry Mechanical efficiency Secular law Humanism Feminism Emancipation Equality Decadence See Ian Buruma & Avishai Margalit, Occidentalism,” New York Review of Books, January 17, 2002