Columbia University

Department of Economics
SUMMER 2021
Economics – S4500: International Trade
Instructor: Ceyhun Elgin
Office: IAB 1037
Office hours: By appointment via Zoom
E-mail: ce2403@columbia.edu
Website: http://www.ceyhunelgin.com
Lecture: M,W, 1:00pm - 4:10pm
TA: TBAt
E-mail is the best way to reach us. Please allow up to 24 hours for a reply.

1 Course description
The pure theory of international trade. Topics include comparative advantage; the gains from trade; tariff
and non-tariff barriers to trade; case studies in international economic policy.

2 Prerequisites
Economics uses mathematical and statistical modeling as tool to understand complex human behavior. In
this course, we will use simple statistical models. But, I will try not to let these statistical models distract
from the economic theory they are assigned to illustrate. If you have a solid grounding in basic algebra,
calculus and quantitative relationships, you should have no trouble with the quantitative content of the
course. You have to be able understand and interpret graphs, make calculations from tables of figures, and
solve simple algebraic equations in order to keep up with the class material. Formally EC 201 is the official
prerequisite for this course.

3 Textbook
The required textbook of the course is:
• International Economics, 2018, by Krugman, P. Obstfeld, M. and Melitz, M. (11th edition), Pearson.

4 Course requirements
4.1 Class participation
Active participation in class is strongly encouraged and you should keep in mind that the definition of
participation includes relevant contributions to class discussion, and participation in in-class activities.

4.2 Problem sets

I will give you two problem sets during the course. All problem sets must be typed (i.e. should not be
hand-written), or you will automatically lose 20 points. Graphs and calculations may be handwritten (they
must be neat). Assignments are due at the beginning of class on the due date. Be certain to clearly note
your name as well as the course number. Homework submitted late will be graded, but 25 points will
automatically be deducted for each day after the due date. If you disagree with the grading please write
your explanations, attach the assignment and hand it to me within 48 hours. You can work with other
students on assignments, this is allowed and encouraged, but each student must write up her or his own
version of a solution, and everyone who collaborated must be acknowledged at the end of the homework.
Identical or similar assignments will get a score of zero. A more severe punishment is not ruled out.

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4.3 Exams
There will be one midterm (W, May 26th) and one final exam (Wednesday June 16th). Both will be in the
form of take-home exam, unless otherwise regulated by the university. If you miss the midterm exam with a
valid and documented excuse, your final exam grade will count for your midterm. The valid document must
be presented to the instructor. All exams are closed book and closed note. No cooperation is allowed during
the tests, and any attempts of dishonesty will be punished with as much severity as the university permits.

5 Grading policy and grading scale

The weights for the final score will be as follows:

Concept Percentage of final grade

Problem Set(s) 24%
Midterm Exam 34%
Final Exam 42%

Below is the grading scale for the course. I reserve the right to lower these cut-off points (i.e., increase
the letter grades for percentages), but I will not raise the cut-offs (i.e., make it harder to get good grades).

Percentage 100-92 91-90 89-88 87-82 81-80 79-78 77-72 71-70 69-68 67-60 59-0
Grade A A- B+ B B- C+ C C- D+ D F
Note that, your grade in this course will reflect what you did in it, not your ability or potential. It is
very important, then, for you to be able to put your work on paper, under time pressure. The letter grade
of A+ is given to an exceptional performance.

6 Academic Conduct
You can read the Columbia University’s Academic Integrity Code here:
https://www.college.columbia.edu/academics/academicintegrity
Notice that you are expected to maintain high standards of academic honesty and integrity throughout this
course.

7 Course schedule
The material that will be covered is summarized below.

• Chapter 1: Introduction
• Chapter 2: World Trade: An Overview
• Chapter 3: The Ricardian Model
• Chapter 4: Specific Factors and Income Distribution
• Chapter 5: Heckscher-Ohlin Model
• Chapter 6: The Standard Trade Model
• Chapter 7: External Economies of Scale and the International Location of Production
• Chapter 8: Firms in the Global Economy
• Chapter 9: Instruments of Trade Policy

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• Chapter 10: Political Economy of Trade Policy
• Chapter 11: Trade Policy in Developing Countries
• Chapter 12: Controversies in Trade Policy
• Chapter 13: Balance of Payments