International Economics I >> Content Detail



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The calendar below lists topics by session.


This course provides a graduate-level introduction to the field of international trade. Topics include gains from trade, Ricardian models of technological differences, Heckscher-Ohlin models of factor endowment differences, intermediate input trade, wage inequality, imperfect competition, firm heterogeneity, multinational firms, international organization of production, dynamics, trade policy, trade and institutions, sorting in trade and foreign direct investment (FDI), and effects of geography on trade. This course is targeted to second-year PhD students in economics.


The prerequisites for this course include Intermediate Microeconomic Theory (14.04). Students are expected to have completed first-year PhD courses in Microeconomic and Macroeconomic Theory. I will not restrict enrollment but make sure you have an appropriate background.

Recommended Texts

There are no required textbooks. The reading list refers to the following books, which are very much worth buying, but will be on reserve at the library:

Amazon logo Dixit, Avinash, and Victor Norman. Theory of International Trade: A Dual, General Equilibrium Approach. Cambridge, UK: Cambridge University Press, 1980. ISBN: 9780521234818.

Amazon logo Feenstra, Robert. Advanced International Trade: Theory and Evidence. Princeton, NJ: Princeton University Press, 2003. ISBN: 9780691114101.

Amazon logo Grossman, Gene, and Elhanan Helpman. Innovation and Growth in the Global Economy. Cambridge, MA: MIT Press, 1991. ISBN: 9780262071369.

Amazon logo Grossman, Gene, and Kenneth Rogoff. Handbook of International Economics. Vol. 3. New York, NY: Elsevier, 1995. ISBN: 9780444815477.

Amazon logo Helpman, Elhanan, and Paul R. Krugman. Market Structure and Foreign Trade: Increasing Returns, Imperfect Competition, and the International Economy. Cambridge, MA: MIT Press, 1987. ISBN: 9780262580878.

Amazon logo Jones, Ronald, and Peter Kenen. Handbook of International Economics. Vol. 1. New York, NY: Elsevier, 1984. ISBN: 9780444867926.


There will be four problem sets, one midterm exam, and one final exam. You will have about two weeks to complete each problem set. The exams will be closed book and closed notes. The midterm and final exams will take place during regular lecture hours.

Class participation10%
Problem sets (5% each)20%
Midterm exam30%
Final exam40%

Recommended Citation

For any use or distribution of these materials, please cite as follows:

Pol Antràs, course materials for 14.581 International Economics I, Spring 2007. MIT OpenCourseWare (, Massachusetts Institute of Technology. Downloaded on [DD Month YYYY].


I. Introduction: Trade facts and gains from trade
1Trade facts and gains from trade
II. Technological differences: Ricardian models
2Technological differences: Ricardian modelsProblem set 1 out
3Eaton and Kortum's (2003) Ricardian model
III. Factor endowment differences: Heckscher-Ohlin
4The 2x2x2 Heckscher-Ohlin model: Part I
5The 2x2x2 Heckscher-Ohlin model: Part IIProblem set 1 due
6The generalized Heckscher-Ohlin model
IV. Empirical tests of the Heckscher-Ohlin model
7Empirical tests of the Heckscher-Ohlin modelProblem set 2 out
V. Intermediate input trade and wage inequality
8Intermediate input trade and wage inequality
VI. Imperfect competition: Theory
9Trade, external scale economics and oligopoly
10Trade and monopolistic competition
VII. Imperfect competition: Empirics
11Trade and monopolistic competition: EmpiricsProblem set 2 due
VIII. Firm heterogeneity
12Intraindustry heterogeneity in trade models: Part IMidterm exam 2 days after Ses #12
13Intraindustry heterogeneity in trade models: Part II
IX. Multinational firms
14Technological theories of foreign direct investment (FDI)Problem set 3 out
X. International organization of production
15The transaction-cost approach in international trade
16The property-rights approach in international trade
XI. Dynamics of international trade
17Dynamic trade theory I: Trade and neoclassical growthProblem set 3 due
18Dynamic trade theory II: Trade, technology, and growthProblem set 4 out
19Dynamic trade theory III: Innovation, technology transfer, and product cycles
XII. Trade policy
20Trade policy I: Determinants of the structure of protection
21Trade policy II: Tariff retaliation and the World Trade Organization (WTO)
22Trade policy III: Regionalism versus multilateralismProblem set 4 due and final exam 2 days after Ses #22

Additional units, time-permitting, include Trade and Institutions, Sorting in Trade and Foreign Direct Investment (FDI), and Trade and Geography.


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