International Economics: Theory and Policy, Global Edition

Paul Krugman, the recipient of the 2008 Nobel Memorial Prize in Economic Sciences, taught at Princeton University for 14 years. In 2015, he joined the faculty of the Graduate Centre of the City University of New York, associated with the Luxembourg Income Study, which tracks and analyses income inequality around the world. In addition to his teaching and academic research, Krugman writes extensively for non-technical audiences and is a regular op-ed columnist for the New York Times. Maurice Obstfeld is the Class of 1958 Professor of Economics at UC Berkeley. He joined Berkeley in 1989 as a Professor, following appointments at Columbia (1979-1986) and the University of Pennsylvania (1986-1989). He was also a visiting Professor at Harvard between 1989 and 1991. From 2014 to 2015 he was a member of President Obama's Council of Economic Advisers, and from 2015 to 2018 served as Chief Economist at the International Monetary Fund. Marc Melitz is the David A. Wells Professor of Political Economy at Harvard University. He holds a BA from Haverford College (1989), an MSBA from the Robert Smith School of Business (1992), and a Ph.D. from the University of Michigan (2000). He is a fellow of the Econometric Society and is affiliated with the National Bureau of Economic Research (NBER), the Centre for Economic Policy Research (CEPR), CESifo, and the Kiel Institute for the World Economy. His broad research interests are in International Trade and Investment.

Introduction

PART ONE: INTERNATIONAL TRADE THEORY

World Trade: An Overview
Labor Productivity and Comparative Advantage: The Ricardian Model
Specific Factors and Income Distribution
Resources and Trade: The Heckscher-Ohlin Model
The Standard Trade Model
External Economies of Scale and the International Location of Production
Firms in the Global Economy: Export Decisions, Outsourcing, and Multinational Enterprises

PART TWO: INTERNATIONAL TRADE POLICY

The Instruments of Trade Policy
The Political Economy of Trade Policy
Trade Policy in Developing Countries
Controversies in Trade Policy

PART THREE: EXCHANGE RATES AND OPEN-ECONOMY MACROECONOMICS

National Income Accounting and the Balance of Payments
Exchange Rates and the Foreign Exchange Market: An Asset Approach
Money, Interest Rates, and Exchange Rates
Price Levels and the Exchange Rate in the Long Run
Output and the Exchange Rate in the Short Run
Fixed Exchange Rates and Foreign Exchange Intervention

PART FOUR: INTERNATIONAL MACROECONOMIC POLICY

International Monetary Systems: A Historical Overview
Financial Globalization: Opportunity and Crisis
Optimum Currency Areas and the Euro
Developing Countries: Growth, Crisis, and Reform