Sem: Quant Methods for Trade
Trade policy professionals who formulate, negotiate, advise, or lobby for trade policies need to understand the underlying stakes and motivations of the parties involved. To develop this understanding requires a firm grasp of micro and macroeconomics of trade and trade policy and an ability to do “back of the envelop calculations” of gains and losses to different parties, in addition to negotiation skills, basic knowledge of international laws and institutions, etc. This course strengthens students’ ability to conduct and interpret basic and intermediate economic and commercial analysis. These include the ability to estimate the impact of trade policies on: (1) production, price, and trade flows, using short-run and long-run elasticities of supply and demand, (2) consumer and producer surplus, (3) tariff equivalents of quotas, subsidies, and other non-tariff barriers, (4) deadweight social loss triangles, (5) changes in profits due to changes in quantity and/or price of traded goods or services, (6) employment impacts of trade flows, and (7) how the impacts of specific policies have "spillover effects" on other sectors and at the macroeconomic level. Students also learn some simple “rules of thumb” to use in constructing estimates even when data are poor or non-existent, as is often true in developing countries.