Explain the heckscher-ohlin model and ho model , International Economics

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1. Explain Pierre Bourdieu's concepts of field, habitus, doxa, and symbolic violence. How do these concepts clarify the continued dominance of neoclassical analysis in mainstream economics, which assumes the economic system is inherently stable, despite its failure to anticipate or explain the 2007-2008 Great Recession and the lack of a quick economic recovery?

2. Describe the steps of the scientific method.  Why is the scientific method seen by many historians as a major step towards the acceleration of human knowledge?

3. Use the "small country" Heckscher-Ohlin model to explain why an economy can achieve welfare gains from exchange without specializing, but it cannot enjoy the gains from specialization without exchanging products with foreigners.

4. Explain the main results from the happiness studies.  What do you think these findings mean for the Heckscher-Ohlin model and its conclusions about international trade?

5. List and explain at least ten reasons why transnational companies have grown so much over the past century.  Can you think of any reasons beyond those discussed in the textbook?

6. Explain how two identical countries with two identical increasing-returns-to-scale industries can gain from trade.  Explain precisely where the gains from trade come from.

7.  a. Explain what assumptions lie behind the Heckscher-Ohlin model and how each of those assumptions defines the curves and results in the two-country, two-product, two-  factor model.

     b. Then explain what happens to international trade if there are transport costs.

     c. What if resources move only slowly from one industry to another?

     d. And how does the presence of negative externalities affect the gains from trade? 

8. Many people equate international trade with either the loss or gain in the number of jobs in their economy.  How does the HO model address the "jobs issue?"  Does trade create or destroy jobs?  Discuss.

9. Arik Levinson and Scott Taylor (2008) examine data for a set of twenty industries impacted by new environmental regulation in the United States, and they find that about half the increase in U.S. imports can be statistically explained by the increases in regulation. What do these results suggest about the welfare effects of international trade?  (Hint: See the DEFRA study on carbon emissions in Britain.)

10. How many examples of international economic integration can you find in your community? List them and classify them as falling under international trade, international investment, international finance, or immigration.


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