CHITTAGONG INDEPENDENT UNIVERSITY

School of Business

Course Name: International Trade and Investment Theories

Course Code: INB 302

Semester: Spring 2021

Instructor Name: Dr. Nusrat Jahan
Adjunct Faculty
Tutorial Hours:  Online Class Hours
 Or by appointment (online /campus)
Email Address: mrs_jahan@ciu.edu.bd

COURSE INFORMATION

Class Monday & Wednesday: 2 – 3.30 PM

Time & Online or Classroom: Room:3402
Room
Course The main objective of this course is to study a comprehensive, up to date, and clear
Description exposition of the theory of international trade so as to understand the basis for and
the gains from trade. In particular, this course focus on traditional models of
Ricardo and Heckscher-Ohlin, and the new trade models based on imperfect
competition with increasing returns to scale. Based on the sound understanding of
the trade theory, this course also explores the effects of trade restrictions on a
nations' welfare.

Course The students are expected to acquire skill that will help them to take rational
Objectives decisions in Issues related to international economics, such as-
 Demonstrate how comparative advantage determines trade patterns and the
gains from trade.
 Determine the relationship between trade pattern, resource utilization, factor
prices and income distribution among countries engaged in international trade.
 Analyze the various methods used in trade restrictions and discuss the
international trade policies.
 Summarizes the reasons for trade restrictions and analyze the welfare effects of
trade restrictions.
 Discuss the effects of economic integration.
 Examine the growth and development with international trade.
Syllabus 1. Introduction
Meaning and importance of globalization, Relationship between international trade
and the nation’s standard of living, Subject matter of international economics.
2. Law of Comparative Advantage
Mercantilists' Views on Trade, Absolute Advantage, Comparative Advantage and
Opportunity Costs, Production Possibility Frontier, Gains from Trade under Constant
Costs.

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 3. Standard Theory of International Trade
PPF with Increasing Costs, MRT, Indifference Curves, MRS, Equilibrium in Isolation,
Gains from Trade with Increasing Costs, Equilibrium, Relative Commodity Prices
with Trade, Incomplete Specialization, Trade Based on Differences in Tastes.
4. Factor Endowments and Heckscher-Ohlin Theory
Heckscher-Ohlin Theorem, General Equilibrium under Heckscher-Ohlin theory,
Factor, Price Equalization Theorem, The Leontief Paradox.
5. Economies of Scale, Imperfect Competition, and International Trade
Trade Based on Economies of Scale, Product Differentiation, Intra-Industry Trade,
Technological Gap and Product Cycle Models.
6. Growth, Development and Trade
Definition and sources of economic growth, Rybczynski Theorem, Effect of
economic growth, Wealth effect, terms of trade effect, Immiserising growth, Effects
of labor endowments and capital endowments growth on welfare, Economic
growth and technical progress.
7. Tariffs, Nontariff Barriers & New Protectionism
Partial Equilibrium Analysis of a Tariff, Costs and Benefits of a Tariff, General
Equilibrium Analysis of a Tariff in Small Country and in Large Country, Comparison
of Import Quota to an Import Tariff, Nontariff Barriers and New Protectionism,
Arguments for Protection, Infant Industry and Other Qualified Arguments for
Protection, Trade Agreements.
8. Economic Integration and Trade Agreements
Trade Creating & Trade, Diverting Customs Unions, Theory of the Second Best and
Other Static Welfare Effects of Customs Unions, European Union, North American
and Other Free Trade Agreements, Economic Integration among Developing
Countries.
9. International Trade and Economic Development
Trade Theory, Terms of Trade, Export Instability and Economic Development,
International Commodity Agreements, Import Substitution versus Exports.
10. Foreign Investment and Multinational Corporations
Definition, Welfare benefits of FDI, Reasons for undertaking FDI, Benefits and
disadvantage of FDI to host countries.

NOTE: The contents of the syllabus may be altered any time at the instructor’s discretion

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TEXTBOOKS
Author Edition
Title Publisher

Dominck Salvatore International Economics 11th Wiley

Edition/2013

Paul Krugman, International Economics: 11th Global Pearson

Maurice Obstfled Theory & Policy Edition /2018
& Marc J. Melitz

TRADTIONAL CLASS ROOM & ONLINE CLASS RULES & POLICIES

 Be on time for online classes as per the class schedule. Keep your Mic OFF unless needed.
 You would be randomly called upon during online class to ensure your class presence and
understanding of the class.
 If you are unresponsive during attendance call, you will be marked absent.
 If you are unable to attend due to valid reason, inform me beforehand via email or CMOS.
 You need to keep yourself up-to-date about the course materials and deadlines with frequent
access to CMOS.
 All course materials, assignments, project, quizzes and/or any announcement will be posted in
CMOS.
 It is mandatory for you to enroll in Google classroom; instruction for enrollment in Google
classroom is given in CMOS. If due to any reason CMOS becomes inaccessible, Google classroom
will be used to communicate any announcements related to this course.
 Mid-term and Final exam may be held in class at the campus. Class tests, quizzes and presentation
can be held online or at the campus depending on the changing situation.
 Cellular phones should be “turned off’/“Silent mode” during the class.
 Cell phone is prohibited during exam and/or quizzes/class tests.
 Academic dishonesty of any type will not be tolerated. This includes, but is not limited to,
plagiarism.
 Classroom professionalism is to be maintained at all times. This means that when the Instructor is
speaking, the classroom should he silent, with the exception of invited questions. As in any
academic environment questions are welcome, but informal chatter or communication among
class members becomes a distraction for all those in attendance and will not be tolerated.
 The ‘no talking’ requirement is enforced during the exam and continues until all students have
handed their exam in to the instructor. Any talking during the exam will disqualify you from
taking the exam. It is my (and all other professors) expectation that your academic work for
the course will be performed without resorting to cheating, plagiarism, lying, and/or bribery.
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 Any student engaging in any of these behaviors will be dealt according to University's code of
conduct.
 Books will be provided by the instructor in the form of PDFs.
 Class rules and/or policies may be altered any time at the instructor’s discretion.

ASSESSMENT CATERGORIES

Mid Term Exam 25%

Final Exam 25%
Individual Presentation 15%
Quiz/Class Test 20%
Individual Assignment/Case 10%
Study
Class Attendance 5%
 This assigned percentage on each category may be altered any time at the instructor’s discretion.

LETTER GRADE FOR NUMERICAL POINTS

Numerical grade/ Marks% Letter Grade (LG) Grade Point (GP/unit)

80-100 A+ 4.00

75 to less than 80 A 3.75

70 to less than 75 A- 3.50

65 to less than 70 B+ 3.25

60 to less than 65 B 3.00

55 to less than 60 B- 2.75

50 to less than 55 C+ 2.50

45 to less than 50 C 2.25

40 to less than 45 D 2.00

00 to less than 40 F 0.00

NOTE: The instructor reserves the right to make any adjustments in the course requirements
consistent with the course’s overall objectives. Total course workload and available time will
be considered in any such adjustments. You will be notified at the earliest possible time if
changes are to be made.

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