International Economics

Course Outline-Spring 2011

Department of International Economics and Trade

School of Business

Shanghai Sanda University


-Lecturer: Ms. Haiying Meng 
    -Telephone: 68681741-8428 

-Office: 8428

-Consultation times: Wednesdays & Fridays 1 to 3 p.m., or by appointment.

(It may be most efficient to email staff with your query if you are unable to ask a staff member in person.)

-Web Site:

(You are advised to check the site on a regular basis. Lecture notes will be posted in the Moodle system under the chapter number for downloading. You should be able to access the Moodle by typing your userid and password.)

-Lecture Times: Tuesdays 13:00-14:20, 4309, Thursdays 14:30-15:50, 4309.


This course aims to provide a highly focused discussion of topics in international economics, which comprises two separate subject areas—international trade and international finance. The first part commences with a detailed discussion of the theories of international trade, the applications of trade policy and regional economic integration. The topics included in the second part are a discussion of balance of payments accounting, foreign exchange market, exchange rate policy and operation of the open macro-economy under different exchange rate regimes. The purpose of the course is to familiarize the student with the analytical tools that economists use to analyze international economic interactions. Students will acquire a comprehensive and systematic knowledge of the bases theories of international economics and the ability to apply economic theories and methods to analyzing international economic phenomena.


Robert J. Carbaugh, International Economics, 10th edition, China Renmin University Press, 2009

Students may also like to refer to the following useful secondary references:

Paul R. Krugman(2008) International Economics Theory and Policy, 7th edition, Tsinghua University Press.

Dominick Salvatore(2004) International Economics, 8th edition, Tsinghua University Press.

Thomas A.Pugel(2005) International Trade, 12th edition, China Renming University Press

Thomas A.Pugel(2005) International Finance, 12th edition, China Renming University Press


Students are also encouraged to keep up-to-date with the latest developments in international business and economy, and this can be achieved through regular reading of the business and economic press. Extending your reading in this manner should increase your appreciation for the subject and also aide your learning. Some useful websites of OECD(,World Bank( Financial Times(,) /China Daily( are also recommended.


Requirements for the course include one group assignment and presentation(10%), two examinations (70%), three individual homework (10%) and class performance (10%).

Group assignment 10%

Examinations 70%

Homework 10%

Class Performance 10%


There are two examinations; the midterm exam is worth 35% and the final exam is worth 35% of the semester grade respectively. Midterm exam will cover chapter 2 to 8 of Carbaugh(2009) and final exam will cover chapter 10 to 16 of Carbaugh(2009). The exams will consist of multiple choice questions, short-answer questions and in some cases numerical problems, true-or-false questions. All exams are closed-book, closed-notes. English-Chinese dictionary and calculators are allowed during the exams. Each exam will cover the required readings from the text. The main objective of the exams is to assess whether students can adequately identify and solve the relevant problems presented.


Instructions for the assignments will be distributed and discussed during class by the instructor. A component of the assignment will also involve a presentation during a week allocated for assignment presentations.

Students should turn in their homework assignments before the due dates. Generally the homework assignment should be turned in before the lecture on the due date. Late assignments receive a mark of zero. Should he or she for any reasons turn in the homework assignments after the due dates, his or her scores will be discounted 10% for every hour the homework is overdue up to a maximum of 50% discount.

Violations of academic integrity standards will be treated seriously. "The use of unauthorized materials, communication with fellow students during an examination, attempting to benefit from the work of another student, and similar behavior that defeats the intent of an examination or other class work is unacceptable to the University. It is often difficult to distinguish between a culpable act and inadvertent behavior resulting from the nervous tensions that accompany examinations. Where a clear violation has occurred, however, the instructor may disqualify the student's work as unacceptable and assign a failing mark on the paper."


Week Topic Carbaugh (2009)
1 Introduction


Foundations of Modern Trade Theory

Chapter 1 & 2
2 Foundations of Modern Trade Theory Chapters 2
3 Sources of Comparative Advantage Chapters 3
4 Sources of Comparative Advantage



Chapters 3


Chapters 4

5 Tariffs Chapters 4
6 Nontariff Trade Barriers Chapters 5, Homework 1
7 Trade Regulations and Industrial Policies Chapters 6
8 Trade Policies for the Developing Nations Chapter 7
9 Regional Trading Arrangements Chapter 8
10 Mid-Session Exam -
11 The Balance of Payments (BOP) Chapter 10
12 Foreign Exchange Chapter 11, Homework 2
13 Group Assignment Presentation  
14 Exchange-Rate Determination Chapter 12
15 BOP Adjustments under Fixed Exchange Rates Chapter 13
16 Exchange-Rate Adjustments and the Balance of Payments Chapter 14, Homework 3
17 Exchange-Rate Systems Chapter 15
18 Macroeconomic Policy in an Open Economy Chapter 16
19 Final Exam -

The topics on this schedule are tentative and subject to change depending upon how quickly we progress through the course material.

Generally examination dates are not subject to change. Examinations will cover material from the previous week's class sessions.