The International Economy 

This module explores the following key economic areas: International trade theory. International economic institutions. Protection. Trade in primary producers. International finance, balance of payments, exchange rates. Foreign investment. Developing countries and the international economy. Third World debt. Economic integration. International environmental issues. Technological progress (including the Internet) and international business.

Studying this module, you will learn and understand:

• The role of economic theory in explaining international trade and finance. International economic institutions. World trade patterns and scope of international business.

• Trade and protection. International trade models. Tests of trade models. Forms of protection. Arguments for and against protection. General Agreement on Tariffs and Trade. The World Trade Organisation. Trade problems of primary producers.

• International finance. Balance of payments and exchange rates. Exchange rates, interest rates and interest parity, foreign exchange risk. The international monetary system and the Euro-currency market. International banking, debt and country risk.

• Investment and the multinational enterprise. Sectoral distribution of direct foreign investment. Theories of direct foreign investment. Cost and benefits of FDI.

• Developing countries and the international economy. Patterns of development. Trade and industrialisation strategies. Economics of newly industrialising countries. Third World debt and economic restructuring. Role of the International Monetary Fund and the World Bank.

• Economic integration. Theory of customs unions. Forms of economic and monetary co-operation. Benefits and costs. The European Community and Monetary Union.

• The international economy and economic restructuring. The role of international financial institutions. Environmental issues and international business. Impact of technological progress (including the Internet) on international business.

• International Financial Markets. Exchange rates, Exchange rate risks and Exchange rate theories.

• Balance of Payment & International Monetary System. The Gold standard, Bretton Woods system, International Monetary Funds and Floating versus Fixed exchange rates.