International Trade: Theory and Policy
Steve Suranovic, George Washington University
Pub Date: 2010
ISBN 13: 978-1-9361264-4-6
Publisher: Saylor Foundation
Conditions of Use
I reviewed Version 1.0 of this text in online format in 2017. The content coverage is appropriate for a one semester international trade course. read more
I reviewed Version 1.0 of this text in online format in 2017. The content coverage is appropriate for a one semester international trade course. There is no index or glossary, but the reader can hover the cursor over key terms that appear in bold for definitions. The text also has links to related sources and further reading. Chapters 5 and 7 are among the strongest in terms of both clarity and depth. The section-end problems more often assess a student's ability to recall information than apply or critically evaluate it. One way to improve the text is to develop more problems relating to higher level learning outcomes.
The author thoughtfully acknowledges different perspectives on the debates surrounding free trade and protectionism, and does so across chapters rather than relegating the discussion to a single chapter. The author is also careful and consistent throughout the text in identifying both the strengths and limitations of the models presented. Equations-within text and tables- need thorough editing. The use of subscripts is inconsistent and therefore confusing, and in a small number of places there are errors in equations. My sense is that most or all of this a formatting issue. (I can readily discern what the author intends and it is correct.) In the preface, the author expresses interest in alienating neither PhD-bound economics students nor non-economists for whom the course is required or of interest. I do not believe this goal can be fully realized without tending to the problems in the equations.
The book's general content is of lasting relevance. Earlier chapters rely on data from 2009 and should be updated with more recent data. Most links to other sources are still functioning and accurate.
Other than my aforementioned concern about the equations, the text is well-ordered and clear. Each chapter sub-section has clearly identified learning objectives to which the end-of-section "Key Takeaways" specifically relate.
On the whole, the text is consistent. At times, some topics (for instance, H-O) are referred to before they are fully explained, but most of the time links to the sections addressing them are provided. Occasionally discussion of building-block components of models seems unbalanced. For instance, the notion of a PPF is introduced from the bottom-up while student understanding of indifference curves seems to be assumed. The latter is less likely to be covered in a prerequisite course than the former.
This text seems relatively easy to break into discrete sections. When it is self-referential, it seems to be with good reason.
The content is presented in a logical fashion both within and across chapters.
It is easy to navigate this text. Source links, key terms, and table links are helpful and for the most part well-functioning and free from error. Tables and figures were undistorted, although as previously mentioned errors in equations complicate the reader's ability to understand certain material.
The text is grammatically correct.
A frequent criticism I have of economics textbooks is the tendency to overuse the US as an example country, whether in a 1-country or 2-country example. Another common criticism I have is the tendency to overuse he/him/his pronouns. A third is associating men with certain occupations and women with others. I am hopeful that future versions of this text might differentiate it from other texts in regard to this concern.
The book provides an exhaustive review of key ideas in the economics of international trade. It does not offer an index or glossary, and both would read more
The book provides an exhaustive review of key ideas in the economics of international trade. It does not offer an index or glossary, and both would be useful. Reading the book as a pdf I was able to use the search function as a substitute for an index; for example, I wanted to review the author's discussion of Paul Krugman's contributions to contemporary trade theory and found all references to Krugman's work by searching for his name.
The content is a basic and standard presentation of key elements in the theory of economic trade, and as such, it offers an accurate survey of this thought.
With respect to trade theory itself, the book is sufficiently up-to-date. However, with respect to the few chapters, largely at the beginning and end of the book, that deal with the political economy of international trade and with trade negotiations, it would be desirable to provide a fuller, more updated discussion. For example, there is only one brief mention of TPP. Discussing the TPP, the ASEAN countries, trade debates within the US, EU, etc. would be a key contribution of a new, updated edition.
The book is clearly written with a large array of graphs and numerical examples. While quantitative, it is not excessively so, and the reader does not have to use calculus to comprehend the book's presentations.
The book is consistent throughout, both in form and content.
The book's chapters provide a logical structure, and within each chapter the subsections are well organized.
Yes, the structure and flow are logical and clear.
Generally good. In some chapters there are a number of hot links to sources. Most of these are still working, but a few did not and need updating. Also, such reference links could be used more extensively and consistently throughout the book, and this would be an enhancement.
This is largely a book of economic theory and its application to trade topics. As such, it is largely acultural, not being especially sensitive or unsensitive to cultural matters. There are many cultural issues that one could delve into with respect to topics in international economics and globalization; however, those are the topics of this book.
An instructor's manual would be helpful, as would a second edition in the not too distant future.
Table of Contents
- Chapter 1: Introductory Trade Issues: History, Institutions, and Legal Framework
- Chapter 2: The Ricardian Theory of Comparative Advantage
- Chapter 3: The Pure Exchange Model of Trade
- Chapter 4: Factor Mobility and Income Redistribution
- Chapter 5: The Heckscher-Ohlin (Factor Proportions) Model
- Chapter 6: Economies of Scale and International Trade
- Chapter 7: Trade Policy Effects with Perfectly Competitive Markets
- Chapter 8: Domestic Policies and International Trade
- Chapter 9: Trade Policies with Market Imperfections and Distortions
- Chapter 10: Political Economy and International Trade
- Chapter 11: Evaluating the Controversy between Free Trade and Protectionism
About the Book
International Trade: Theory and Policy is built on Steve Suranovic’s belief that to understand the international economy, students need to learn how economic models are applied to real world problems. It is true what they say, that ”economists do it with models.“ That’s because economic models provide insights about the world that are simply not obtainable solely by discussion of the issues. International Trade: Theory and Policy presents a variety of international trade models including the Ricardian model, the Heckscher-Ohlin model, and the monopolistic competition model. It includes trade policy analysis in both perfectly competitive and imperfectly competitive markets.
The text also addresses current issues such as free trade area formation and administered protection policies. The models are developed, not by employing advanced mathematics, but rather by walking students through a detailed description of how a model’s assumptions influence its conclusions. But more importantly, each model and theory is connected to real world policy issues.
The main purpose of the text is to provide a thorough grounding in the arguments concerning the age-old debate about free trade versus protectionism. This text has the following unique features: The text begins with an historical overview of trade policy issues to provide context for the theory. The text concludes with a detailed economic argument supporting free trade. The welfare analysis in the Ricardian, Heckscher-Ohlin and specific factors models emphasize the redistributive effects of free trade by calculating changes in real incomes. The trade policy chapter provides a comprehensive look at many more trade policies than are found in a printed textbook.
A chapter about domestic policies contains an evaluation of domestic taxes and subsidies that are often ignored in traditional trade textbooks but are increasingly important as large countries complain more about each other's domestic agriculture policies and labor and environmental policies.
The text uses the theory of the second-best to explain why protection can improve national welfare. This well-known theoretical result is rarely presented as methodically and consistently as it is in this text.
International Trade: Theory and Policy by Steve Suranovic is intended for a one-semester course in International Trade. After April 2010, you can check out the entire book online or request a desk copy.
About the Contributors
Steve Suranovic is an associate professor of economics and international affairs at the George Washington University (GW) in Washington, DC. He has a PhD in economics from Cornell University and a BS in mathematics from the University of Illinois at Urbana-Champaign. He has been teaching international trade and finance for more than twenty years at GW and as an adjunct for Cornell University’s Washington, DC, program. In fall 2002, he taught at Sichuan University in Chengdu, China, as a visiting Fulbright lecturer. He has taught a GW class at Fudan University in Shanghai during the summers of 2009 and 2010. He has also spoken to business, government, and academic audiences in Japan, Malaysia, the Philippines, China, and Mongolia as part of the U.S. State Department speaker’s programs.
His research focuses on two areas: international trade policy and behavioral economics. With respect to behavior, he examines why people choose to do things that many observers view as irrational. Examples include addiction to cigarettes, cyclical dieting, and anorexia. His research shows that dangerous behaviors can be explained as the outcome of a reasoned and rational optimization exercise. With respect to trade policy, his research seeks to reveal the strengths and weaknesses of arguments supporting various policy options. The goal is to answer the question, what trade policies should a country implement? More generally, he applies the economic analytical method to identify the policies that can attract the most widespread support.
His book A Moderate Compromise: Economic Policy Choice in an Era of Globalization will be released by Palgrave Macmillan in fall 2010. In it he offers a critique of current methods to evaluate and choose policies and suggests a simple, principled, and moderate alternative.