International Economics

[Cecilia Santos]

International Economics is a branch of economics that studies the economic interactions among countries, including trade, finance, and policy considerations. Here are some key topics within International Economics:

Trade Theories:

Comparative Advantage: The principle that countries should specialize in producing goods and services where they have a lower opportunity cost and trade with others for goods and services they produce less efficiently.
Heckscher-Ohlin Model: Explains trade based on differences in countries’ factor endowments (land, labor, capital) and how these determine comparative advantage.
Trade Policies:

Tariffs and Quotas: Taxes on imports (tariffs) and quantitative restrictions (quotas) imposed by governments to protect domestic industries or achieve other policy goals.
Trade Agreements: Bilateral and multilateral agreements that aim to reduce barriers to trade, such as free trade agreements (FTAs) and customs unions.
Balance of Payments:

Current Account: Records a country’s trade balance (exports minus imports), income from abroad, and unilateral transfers.

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