1. Copyright © 2003 Pearson Education, Inc.Slide 5-1  International Effects of Growth Export-biased growth in the rest of the world improves our terms of trade( 圖形說明 ), while import-biased growth abroad worsens our terms of trade ( 圖形說明 ). 圖形說明 Export-biased growth in our country worsens our terms of trade, reducing the direct benefits of growth( 圖 形說明 ), while import-biased growth leads to an improvement of our terms of trade( 圖形說明 ). 圖 形說明 圖形說明 A Standard Model of a Trading Economy

2. Copyright © 2003 Pearson Education, Inc.Slide 5-2 Figure 5-7: Growth and Relative Supply Relative price of cloth, P C /P F Relative quantity of cloth, Q C + Q * C Q F + Q * F RS 1 RD 1 (P C /P F ) 1 RS 2 (P C /P F ) 2 2 (a) Cloth-biased growth 返回 1 ；返回 2 返回 1返回 2 A Standard Model of a Trading Economy

3. Copyright © 2003 Pearson Education, Inc.Slide 5-3 A Standard Model of a Trading Economy Figure 5-7: Growth and Relative Supply RS 2 2 (P C /P F ) 2 (P C /P F ) 1 1 (b) Food-biased growth 返回 1 ; 返回 2 返回 1 返回 2 Relative price of cloth, P C /P F Relative quantity of cloth, Q C + Q * C Q F + Q * F RS 1 RD

4. Copyright © 2003 Pearson Education, Inc.Slide 5-4 Immiserizing growth –A situation where export-biased growth by poor nations can worsen their terms of trade so much that they would be worse off than if they had not grown at all –It can occur under extreme conditions: Strongly export- biased growth must be combined with very steep RS and RD curves. 圖形說明 圖形說明 –It is regarded by most economists as more a theoretical point than a real-world issue. A Standard Model of a Trading Economy

5. Copyright © 2003 Pearson Education, Inc.Slide 5-5 RS s 1 RD s 1 RS 1 1 RD 1 (P C /P F ) 1 Immiserizing growth Relative price of cloth, P C /P F Relative quantity of cloth, Q C + Q * C 返回 返回 Q F + Q * F RS 2 (P C /P F ) 2 2 RS s 2 (P C /P F ) 3 3

6. Copyright © 2003 Pearson Education, Inc.Slide 5-6 Table 5-1: Average Annual Percent Changes in Terms of Trade A Standard Model of a Trading Economy