国际商务英语课件unit 1.ppt

1、International Business Topics New Edition,Unit 1 International Trade Theory,Goals of the Unit 1. Identify theories of international trade 2. Understand the implications of the theories to businesses.,Warming up questions,1. Why do we learn trade theories, and how many do you know? 2. How do they exp

2、lain or affect the pattern of world trade? 3. What benefits can we get by learning these theories?,What do trade theories tell us?,Benefits of international trade theories show why countries should trade for products/ services even when they can produce them domestically Patterns of international tr

3、ade theories show why countries specialize the way they do Role of the government theories help articulate the role of government policy,An overview of trade theory development,Early thinking: Mercantilism Adam Smith: The theory of absolute advantage, 1776 Ricardo: The theory of comparative advantag

4、e, 1817 Heckscher-Olin theory: 20th century,An overview of trade theory Development(continued),Product Life cycle effects “New” trade theory Porters diamond: national competitive advantage,1.Mercantilism (mid-16th 17th )重商主义,Basic theme: encourage exports, discourage imports (gold/silver as national

5、 wealth) Fundamental weakness: Trade is seen as a zero-sum game (a gain by one country results in a loss by another),What is its argument ?,Government intervention by tariffs & quotas,Although discredited as a theory, mercantilist thinking is still very much alive so called neo-mercantilism:,Instrum

6、ents of Trade Policy,Tariffs Subsidies Import quotas (and “voluntary” export restraints Local content requirements Administrative trade policies (bureaucratic hurdles),David Hume (1752) critique on mercantilism,Long-run surplus is impossible,If England had a trade surplus with France,Inflation Expen

7、sive goods export decreased,Contraction Cheaper goods Export increased,England trade deteriorates, France trade improves,Result:,2.Absolute Advantage,Adam Smith (1776)attacked mercantilism: Countries differ in production efficiency, climate, soil, accumulated expertise, thus absolute advantage Count

8、ries specialize in the production of goods with AA and trade for others Both countries benefit from international trade. It is positive-game,Wealth of Nation,David Ricardo:,Question: What happens when one country has an absolute advantage in all goods? Answer: Still makes sense to trade, produce onl

9、y those goods which can be made most efficiently, trade for the others,Principles of Political Economy,3. Comparative Advantage,David Ricardo (1817): Countries with AA in all goods specialize in its most efficient production (CA) Advocate positive-sum game Free trade leads to potential world product

10、ion and demand,Extension of Ricardos model,Constant returns to specialization the unit of resource used to produce a good remain constant. PPF: illustrate 3 conceptsscarcity, choice, opportunity cost Diminishing returns to specializationoutput increase leads to increased consumption of resource Reas

11、ons: unequal quality of resources different proportion of resources for different products,Significance of Diminishing Return,Specialization is limited Gains from specialization may diminish before it is completed No country produce only one goods, but a range of goods,Adam Smith-Ricardo Conclusions

12、,Comparative advantage stems from differences in productivity (efficiency),Free trade bring dynamic gains: supplies of labor and capital abroad add a countrys resource stock (FDI) Improved efficiency of resources utilization (Economy of scale, Imported technology) Potential of world production will

13、be greater,4.Heckscher-Ohlin Theory,Comparative advantage arises from a different source production factors Countries differ in factor endowments， thus different factor cost Factor endowments determine pattern of international trade,Heckscher-Olin vs. Ricardo,Ricardo: comparative advantage stems fro

14、m differences in productivity Heckscher-Olin: national factor endowments are responsible for the difference,Is it always the case?,The Leontief Paradox 列昂惕夫反论,Heckscher-Olin is intuitively appealing but fails in explaining the real world trade pattern. Factor intensity reversal 要素密度逆转 Agricultural g

15、oods may turn into labor-intensive from land- intensive in China, thus export to U.S. This violate HO theory.,美国经济学家，在研究美国生产与出口后得出与俄林理论完全相反的结论。,5. Product Life-Cycle Theory,Sales,Sales & profit ($),Profits,Losses/ investment($),Development Introduction Growth Maturity Decline,Time,0,Raymond Vernon P

16、rof of HBS. U.S,Vernon: Product Life Cycle Theory,As products (markets) mature, both the location of sales and of (optimal) production change, thereby affecting the pattern of exports and imports For many, especially technology products, the pattern is: US Other advanced countries Developing nations

17、 US It also proves H-O theorys flaw.,Trade pattern based on PLC,6. “New” trade theory (1970s),Origin: questioning of the assumption of diminishing returns to specialization. Instead: economies of scale fostered increasing returns to specialization The principle of comparative advantage is undermined

18、 by first-mover advantage The new theory identifies an important source of comparative advantage.,It refers to the ability to increase the output of a product with specialization owning to larger scale and lower unit costs. Economy of scale is derived by spreading fixed cost over a larger output.,Wh

19、at does economy of scale mean?,What is first-mover advantage?,Early entrants into an industry may get a lock on the world market that prevent subsequent comers. They are able to reap economy of scale and creates entry barriers.,7. Porters diamond:National Competitive Advantage,Outgrowth of “new” tra

20、de theory Focus on four national attributes: factor endowments demand conditions related and supporting industries firm strategy, structure, rivalry Two influencers: Governments and chance,Porters Diamond,Implication of Porters Diamonds,Explain why a nation achieves international success in a partic

21、ular industry.,Favorable diamond provides better chance for businesses. It is a mutually reinforcing system. The effect of one attribute is contingent on the state of others,Why do governments intervene?,“protecting jobs and industries” “protecting industries vital for national security” as part of a “get tough” policy to open foreign markets “strategic” trade policy: protecting infant industries, aiding first-mover advantage, overcoming barriers to entry,8. Implications for businesses,Which theories explained t