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Lower unit labor requirement - PowerPoint PPT Presentation

I. International Capital Mobility

I. International Capital Mobility a. Why international capital flows ? (i) Capital flows as a counterpart of the exchange of goods (see point b) Trade balance = Net capital outflows Exchange of goods results from differences across countries: productivity, endowments, time preference.

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Chapter 3 Ricardian Model

Chapter 3 Ricardian Model. Ricardian Model. Opportunity costs and comparative advantage An Example Relative demand-relative supply analysis A one factor Ricardian model Production possibilities Gains from trade Wages and trade Misconceptions about comparative advantage

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The Ricardian Model

PPF H. PPF H. PPF F. Relative price. Relative price. Relative price. R S. R D. The pattern of trade The gains from trade. equilibrium. The Ricardian Model. Trade in a One-Factor World. Absolute Advantage

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Lower unit labor requirement - PowerPoint PPT Presentation

I. International Capital Mobility

Chapter 3 Ricardian Model

The Ricardian Model