Trade Lesson 4 Global Trade Theory II: The Standard Trade Model
  
 
 
 
Trade Lesson 4 Global Trade Theory II: The Standard Trade Model

Overview

This lesson combines the ideas of the Ricardian trade model and the Heckscher-Ohlin model of comparative advantage, and derives the Standard trade model. This part describes the relevant concepts and tools: relative supply and demand, world price, and terms of trade.

Relevant Learning Objectives

4. Combine the ideas of the Ricardian trade model and the Heckscher-Ohlin model of comparative advantage and derive the Standard trade model, and the relevant concepts and tools: relative supply and demand, world price, and terms of trade.

Procedure

Pre-Class Assignments

  • Students read Chapters 5 of the textbook

Possible Classroom Activities

Resources

Optional Resources

 

Next: Lesson 5 Trade Policy Instruments