The greatest strength of this thoroughly revised and expanded edition of Lectures on International Trade is its rigorous algebraic and geometric treatment of the various models and results of trade theory. The authors, who now include Arvind Panagariya, offer both policy insights and empirical applications. They have added nine entirely new chapters as well as new sections to several existing chapters (e.g., a greatly expanded treatment of the growing theory of preferential trade agreements).
Jagdish N. Bhagwati is University Professor of Economics, Law, and International Relations at Columbia University and former Adviser to the Director General of GATT, Arthur Dunkel. He is the author (with Arvind Panagariya) of Why Growth Matters: How Economic Growth in India Reduced Poverty and the Lessons for Other Developing Countries. Arvind Panagariya is Vice Chairman, NITI Aayog (National Institution for Transforming India), Government of India, and Professor of Economics in the School of International and Public Affairs at Columbia University. T.N. Srinivasan is Samuel C. Park Jr. Professor of Economics at Yale University.
Part 1 Theories of international trade: model and analytic relationships in Ricardian theory; Ricardian theory and the pattern of trade; some extensions of Ricardian theory; model and analytic relationships under the Heckscher-Ohlin theory; pattern of trade and the Heckscher-Ohlin theory; specific-factors model; generalizations and empirical verification of the Heckscher-Ohlin theory; dual approach - basic tools; mathematical analysis of the 2x2 and 2x3 models; economies of scale. Part 3 Trade interventions and transfers: tariffs and trade equilibrium; tariffs versus quotas; other commercial policy instruments; effective rate of protection; transfer problem. Part 3 Trade and welfare in an open economy: principal issues and policy instruments; gains from trade; measuring gains from trade; distortions - departures from free-trade optimality; monopoly power in trade; production externalities; monopoly in production; monopsony; wage differentials; generalized sticky wages; sector-specific sticky wages; noneconomic objectives; immiserizing growth; imperfect competition and trade policy; uniform versus preferential tariff reduction; international capital flows; international migration; asymmetries. Part 4 recent theoretical developments: directly unproductive profit-seeking (DUP) activities; trade reform; growth and welfare; endogenous growth, innovation, and trade; shadow prices for project selection in open economies; uncertainty. Appendices: alternative elasticity formulas; basic results of the 2x2 neoclassical model of trade theory; classical comparative-statics model and analytical relationships.