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.

Learning Outcomes

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
to:
• Analyze the determinants of international trade flows.
• evaluate the welfare effects of alternative trade policies.

Required Resources

Readings will be provided on Wattle.

Recommended Resources

Advanced International Trade
Author: Feenstra, R.C.
Publisher: Princeton University Press, Princeton.
Edition:
ISBN:
Availability: Campus Bookstore
Price:
Notes:

The Theory of International Trade,
Author: Markusen, J. R. and J.R. Melvin
Publisher: Harper & Row, Sydney
Edition:
ISBN:
Availability: Campus Bookstore
Price:
Notes:

International Economics: Theory and Policy
Author: Krugman, P. and Obstfeld, M.
Publisher: Addison Wesley, Sydney
Edition: 10th Edition
ISBN:
Availability: Campus Bookstore
Price:
Notes:

Staff Feedback

Students 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 Feedback

ANU 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.

Class Schedule

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.

Tutorial Registration

25/02/2019

Assessment Summary

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

Policies

ANU 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:

• Student Assessment (Coursework) Policy and Procedure
• Special Assessment Consideration Policy and General Information
• Student Surveys and Evaluations
• Deferred Examinations
• Student Complaint Resolution Policy and Procedure

Assessment Requirements

The 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 Assessment

Marks 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

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.

 Data sets:

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

Empirical Research Paper

See Details of Assessment Task 1

Assessment Task 3

Final Examination

A final examination of 2 hours duration will be held at the end of the course during the First Semester examination period.

Academic Integrity

Academic integrity is a core part of our culture as a community of scholars. At its heart, academic integrity is about behaving ethically. This means that all members of the community commit to honest and responsible scholarly practice and to upholding these values with respect and fairness. The Australian National University commits to embedding the values of academic integrity in our teaching and learning. We ensure that all members of our community understand how to engage in academic work in ways that are consistent with, and actively support academic integrity. The ANU expects staff and students to uphold high standards of academic integrity and act ethically and honestly, to ensure the quality and value of the qualification that you will graduate with. The University has policies and procedures in place to promote academic integrity and manage academic misconduct. Visit the following Academic honesty & plagiarism website for more information about academic integrity and what the ANU considers academic misconduct. The ANU offers a number of services to assist students with their assignments, examinations, and other learning activities. The Academic Skills and Learning Centre offers a number of workshops and seminars that you may find useful for your studies.

Online Submission

The ANU uses 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. While the use of Turnitin is not mandatory, the ANU highly recommends Turnitin is used by both teaching staff and students. For additional information regarding Turnitin please visit the ANU Online website.

Hardcopy Submission

For some forms of assessment (hand written assignments, art works, laboratory notes, etc.) hard copy submission is appropriate when approved by the Associate Dean (Education). Hard copy submissions must utilise the Assignment Cover Sheet. Please keep a copy of tasks completed for your records.

Late Submission

Late submission of assessment tasks without an extension are penalised at the rate of 5% of the possible marks available per working day or part thereof. Late submission of assessment tasks is not accepted after 10 working days after the due date, or on or after the date specified in the course outline for the return of the assessment item. Late submission is not accepted for take-home examinations.

Referencing Requirements

Accepted academic practice for referencing sources that you use in presentations can be found via the links on the Wattle site, under the file named “ANU and College Policies, Program Information, Student Support Services and Assessment”. Alternatively, you can seek help through the Students Learning Development website.

Extensions and Penalties

Extensions and late submission of assessment pieces are covered by the Student Assessment (Coursework) Policy and Procedure The Course Convener may grant extensions for assessment pieces that are not examinations or take-home examinations. If you need an extension, you must request an extension in writing on or before the due date. If you have documented and appropriate medical evidence that demonstrates you were not able to request an extension on or before the due date, you may be able to request it after the due date.

Privacy Notice

The ANU has made a number of third party, online, databases available for students to use. Use of each online database is conditional on student end users first agreeing to the database licensor’s terms of service and/or privacy policy. Students should read these carefully. In some cases student end users will be required to register an account with the database licensor and submit personal information, including their: first name; last name; ANU email address; and other information. In cases where student end users are asked to submit ‘content’ to a database, such as an assignment or short answers, the database licensor may only use the student’s ‘content’ in accordance with the terms of service — including any (copyright) licence the student grants to the database licensor. Any personal information or content a student submits may be stored by the licensor, potentially offshore, and will be used to process the database service in accordance with the licensors terms of service and/or privacy policy. If any student chooses not to agree to the database licensor’s terms of service or privacy policy, the student will not be able to access and use the database. In these circumstances students should contact their lecturer to enquire about alternative arrangements that are available.

Distribution of grades policy

Academic Quality Assurance Committee monitors the performance of students, including attrition, further study and employment rates and grade distribution, and College reports on quality assurance processes for assessment activities, including alignment with national and international disciplinary and interdisciplinary standards, as well as qualification type learning outcomes. Since first semester 1994, ANU uses a grading scale for all courses. This grading scale is used by all academic areas of the University.

Support for students

The University offers students support through several different services. You may contact the services listed below directly or seek advice from your Course Convener, Student Administrators, or your College and Course representatives (if applicable).

• ANU Health, safety & wellbeing for medical services, counselling, mental health and spiritual support
• ANU Diversity and inclusion for students with a disability or ongoing or chronic illness
• ANU Dean of Students for confidential, impartial advice and help to resolve problems between students and the academic or administrative areas of the University
• ANU Academic Skills and Learning Centre supports you make your own decisions about how you learn and manage your workload.
• ANU Counselling Centre promotes, supports and enhances mental health and wellbeing within the University student community.
• ANUSA supports and represents undergraduate and ANU College students
• PARSA supports and represents postgraduate and research students