- Class Number 2960
- Term Code 2930
- Class Info
- Unit Value 6 units
- Mode of Delivery In Person
- Prof Kaliappa Kalirajan
- Prof Kaliappa Kalirajan
- Class Dates
- Class Start Date 25/02/2019
- Class End Date 31/05/2019
- Census Date 31/03/2019
- Last Date to Enrol 04/03/2019
This course will acquaint the student with the quantitative techniques employed in
international trade. This course is divided into two main components: the first part introduces
important concepts and provides a foundation for understanding the flows and patterns of
trade across countries. The second part deals with empirical measurements of the links
between trade and economic welfare. The selected topics covered in this context are:
regional economic integration, exchange rate and trade, trade policy and environment, and
trade, growth and poverty reduction.
Upon successful completion, students will have the knowledge and skills to:
On satisfying the requirements for this course, the student will have the knowledge and skills
• Analyze the determinants of international trade flows.
• evaluate the welfare effects of alternative trade policies.
Readings will be provided on Wattle.
Advanced International Trade
Author: Feenstra, R.C.
Publisher: Princeton University Press, Princeton.
Availability: Campus Bookstore
The Theory of International Trade,
Author: Markusen, J. R. and J.R. Melvin
Publisher: Harper & Row, Sydney
Availability: Campus Bookstore
International Economics: Theory and Policy
Author: Krugman, P. and Obstfeld, M.
Publisher: Addison Wesley, Sydney
Edition: 10th Edition
Availability: Campus Bookstore
Staff FeedbackStudents will be given feedback in the following forms in this course:
- Written comments
- Verbal comments
- Feedback to the whole class, to groups, to individuals, focus groups
Student FeedbackANU is committed to the demonstration of educational excellence and regularly seeks feedback from students. Students are encouraged to offer feedback directly to their Course Convener or through their College and Course representatives (if applicable). The feedback given in these surveys is anonymous and provides the Colleges, University Education Committee and Academic Board with opportunities to recognise excellent teaching, and opportunities for improvement. The Surveys and Evaluation website provides more information on student surveys at ANU and reports on the feedback provided on ANU courses.
|Week/Session||Summary of Activities||Assessment|
|1||Lecture - Week 1: International economics, regional ecnomics, and national economics. Lecture notes (PPP).|
|2||Lecture - Week 2: An overview –A preview of International trade theories Feenstra (2004): 1-30.|
|3||Lecture - Week 3: Patterns of trade; international factor movements: Theories Markusen and Melvin (1988):281-301.|
|4||Lecture - Week 4: Instruments of trade policy; Tariffs; quantitative restrictions and welfare analysis Feenstra (2004): 207 –223 and 254-259.|
|5||Lecture - Week 5: Trade pattern and flow analyses. Trade intensities Garnaut, R. and P. Drysdale. 1982 “Trade Intensities and the Analysis of Bilateral Trade Flows in a Many-Country World”, Hitotsubashi Journal of Economics, 22, 2: 62-84.|
|6||Lecture - Week 6: Constant market share analysis. Conventional gravity model and estimation (1) Leamer, E.E. and R.M. Stern, 1970, ‘Constant-market-share analysis of export growth’, Chapter 7 in Quantitative International Economics, E.E. Leamer and E.M. Stern, Boston: Allyn and Bacon Inc.,pp. 171-183. (2) 1. K.P. Kalirajan and Kanhaiya Singh, 2008. “A Comparative Analysis of China’s and India’s Recent Export Performances”, Asian Economic Papers, 7(1): 1-30.|
|7||Lecture - Week 7: Advanced gravity model, specification, estimation and analysis Kalirajan, K. 2008. “Gravity Model Specification and Estimation: Revisited”, Applied Economics Letters, 15(13): 1037-39. Imran Ullah Khan and Kaliappa Kalirajan, 2011. “The impact of trade costs on exports: An empricial modelling”, Economic Modelling, 28(3): 1341-1347.|
|8||Lecture - Week 8: The status of economic integration; Asian economic integratioin (1) Drysdale, P. and R. Garnaut (eds.) 1994. Asia Pacific Regionalism: Readings in International Economic Relations, Harper Education Publishers, Sydney. (2) Shujiro Urata, 2008. “An Economic Analysis of Competitive Regionalism in East Asia”, Waseda University, Tokyo. (3) Kalirajan, K. and P. Drysdale, 2013, "India's Integration with East Asia: An Exploratory Analysis", Crawford School of Public Policy, The Australian National University.|
|9||Lecture - Week 9: Exchange rate and trade: devaluation and export subsidies (1) Thanh, N.N. and K.Kalirajan. 2005. “The Importance of Exchange Rate Policy in Promoting Vietnam’s Exports”, Oxford Development Studies, 33(3), 51-60. (2) Thanh, N.N. and K. Kalirajan. 2006. “Can Devaluation be Effective in Improving the Balance of Payments in Vietnam?”, Journal of Policy Modeling, 28: 467-476.|
|10||Lecture - Week 10: Foreign direct investment: determinants and impact on host economies (1) Markusen and Melvin (1988): 302-314. (2) M. Kondeker and K. Kalirajan, 2010, "Determinants of Foreign Direct Investment in Low-income and Lower-Middle Income Countries: A Comparative Analysis”, Margin:Journal of Applied EconomicResearch, 4(4): 369-404, 2010.|
|11||Lecture - Week 11: Trade-environment linkages, and foreign direct investment-poverty reduction linkages (1) K. Kalirajan, V. Anbumozhi and K. Singh, ‘Measuring the Environmental Impacts of Changing Trade Patterns on the Poor’, Asian Development Bank Institute Working Paper No. 239, pp.1-27, 2010. (2) Kalirajan, K. and Yichang Liu, 2017, " Regional Cooperation in Renewable Energy Trade: Prospects and Constraints" in V. Anbumozhi and K. Kalirajan (eds.) Globalization of Low-Carbon Technologies, Singapore: Springer, pp. 459-478. (3) Kalirajan, K. and K. Singh, 2008, "The Pace of Poverty Reduction Across the Globe: An Exploratory Analysis", International Journal of Social Economics, 36(6): 692-705.|
|12||Lecture - Week 12: Computable General Equilibrium Models and Trade Policy Analyses Jaime de Melo, (1988), “Computable general equilibrium models for trade policy analysis in developing countries: A Survey”, Journal of Policy Modeling, 10(4): 489-503.|
|Assessment task||Value||Due Date||Return of assessment||Learning Outcomes|
|Empirical Research Paper (Outline)||0 %||15/03/2019||22/03/2019||1,2|
|Empirical Research Paper||50 %||31/05/2019||04/07/2019||1,2|
|Final Examination||50 %||06/06/2019||04/07/2019||1,2|
* If the Due Date and Return of Assessment date are blank, see the Assessment Tab for specific Assessment Task details
PoliciesANU has educational policies, procedures and guidelines, which are designed to ensure that staff and students are aware of the University’s academic standards, and implement them. Students are expected to have read the Academic Misconduct Rule before the commencement of their course. Other key policies and guidelines include:
Assessment RequirementsThe ANU is using Turnitin to enhance student citation and referencing techniques, and to assess assignment submissions as a component of the University's approach to managing Academic Integrity. For additional information regarding Turnitin please visit the ANU Online website Students may choose not to submit assessment items through Turnitin. In this instance you will be required to submit, alongside the assessment item itself, hard copies of all references included in the assessment item.
Moderation of AssessmentMarks that are allocated during Semester are to be considered provisional until formalised by the College examiners meeting at the end of each Semester. If appropriate, some moderation of marks might be applied prior to final results being released.
Assessment Task 1
Learning Outcomes: 1,2
Empirical Research Paper (Outline)
It is mandatory to submit a research paper in this course. The research paper will employ a quantitative technique covered in this course to analyze a development policy issue selected by the student and approved by the course coordinator.
The research paper should not exceed 4000 words in length, in 1.5 line spacing, 12 point Times New Roman font, single-sided, including all tables, graphs and references. Reports longer than 4000 words will not be accepted.
The research paper must apply quantitative methods e.g. estimation of gravity models, estimate the impact of trade protection on productivity, and use computable general equilibrium to address an issue within international trade.
Students must submit a one page research project outline including the title of the project, the data sources, and one key reference to the course coordinator by no later than Friday, 15 March 2019, 11:55pm. The feedback will be given by Friday, 22 March 2019.
Research paper must conform to the following standards:
The paper can be based on models and specifications already existing in the literature, but otherwise it must be the original work of the student. Cases of plagiarism and/or source material that is not referenced properly will constitute an immediate and unredeemable fail on the research paper.
Each research paper must contain a brief literature review and a list of references, properly cited throughout the text.
Each paper must also have a clearly defined •research question• that is being addressed with the chosen quantitative method and a section that clearly discusses the results and implications of the quantitative measures. Simply reporting results without discussion is not acceptable.
Data sets must be submitted by email to the course coordinator (in standard Excel format) so that estimates can be verified when the research report is graded. The data file is to be named with u.xls.
The research paper will be assessed on the following criteria:
Analytical Content 60 %
Originality 30 %
Referencing 10 %
Students are urged to consult with Academic and Research Skills team throughout the semester for assistance with academic and research skills and in the preparation of the report.
A research paper of 4000 words maximum should be submitted in soft copy at the Wattle by 31 May 2019, 11:55pm.
Sample Research Report Topic Areas
The following are examples of research paper topic areas, listing a topic and a few suggested readings. If using one of these topic areas, the student must still form their own research question (e.g., •While China is able to increase its labour-intensive manufacturing exports, why India is not able to do?•), and must also do an extensive literature search, finding papers that are useful to their own research report.
Note: Students may choose a topic other than those listed below.
1. Functional form and estimates of the gravity equation
Bergstrand, J., 1985, •The gravity equation in international trade: some microeconomic foundations and empirical evidence•, The Review of Economics and Statistics, Vol. 67, August, pp. 474-481.
Kalirajan, K. 2008. •Gravity Model Specification and Estimation: Revisited•, Applied Economics Letters, 15(13): 1037-39.
Kalirajan, K. 2007. •Regional Cooperation and Bilateral Trade Flows: An Empirical Measurement of Resistance•, The International Trade Journal, 21(2): 85-107.
Links to international organisations• websites: http://rfe.org/
Great circle distances: http://www.chemical-ecology.net/java/lat-long.htm
Economic Freedom Indices: http://www.heritage.org/research/features/index/
2. Exchange rate and trade
Thanh, N.N. and K.Kalirajan. 2005. •The Importance of Exchange Rate Policy in Promoting Vietnam•s Exports•, Oxford Development Studies, 33(3), 51-60
Thanh, N.N. and K. Kalirajan. 2006. •Can Devaluation be Effective in Improving the Balance of Payments in Vietnam?•, Journal of Policy Modeling, 28: 467-476.
3. Trade measures
Leamer, E.E. and R.M. Stern, 1970, •Constant-market-share analysis of export growth•, Chapter 7 in Quantitative International Economics, E.E. Leamer and E.M. Stern, Bosston: Allyn and Bacon Inc., pp. 171-183.
Herschede, F., 1991, •Competition among ASEAN, China and the East Asian NICs: a shift-share analysis•, ASEAN Economic Bulletin, 7 (3), pp. 290-306.
Garnaut, R. and Peter Drysdale). 1982 •Trade Intensities and the Analysis of Bilateral Trade Flows in a Many-Country World•, Hitotsubashi Journal of Economics, 22, 2, February, p.62-84.
4. Trade liberalization and development
Greenaway, D, W. Morgan, and P Wright, 2002, •Trade liberalisation and growth in developing countries•, Journal of Development Economics, 67, pp. 229-244.
Kalirajan, K.P and S. Bhide 2004. •The Post-Reform Performance of the Manufacturing Sector in India•, Asian Economic Papers, 2004,3(2): 126-157.
5. Regional groupings
Kalirajan, K.P. 2000. •Indian Ocean Rim Association for Regional Cooperation (IOR-ARC): Impact on Australia•s Trade•, Journal of Economic Integration, 15, pp.533-547.
Drysdale, P. 2005. •Regional cooperation in East Asia and FTA strategies•, Pacific Economic Papers No. 344, Australia•Japan Research Centre, Canberra, 17 pp.
Drysdale, P. and R. Garnaut (eds.) 1994. Asia Pacific Regionalism: Readings in International Economic Relations, Harper Education Publishers.
6. CGE models
John Shoven and John Whalley, Applying General Equilibrium, Cambridge: Cambridge University Press, 1992.
Assessment Task 2
Learning Outcomes: 1,2
Empirical Research Paper
See Details of Assessment Task 1
Assessment Task 3
Learning Outcomes: 1,2
A final examination of 2 hours duration will be held at the end of the course during the First Semester examination period.
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Sources of Growth; Low-carbon energy systems in Asia; International trade and regional integration; Micro- and Macro-econometric modelling.
Prof Kaliappa Kalirajan