SYLLABUS

EKO 2301 – INTERNATIONAL ECONOMICS I

Prerequisite: EKO-1105 – Microeconomics 1
EKO – 1102 - Introduction of Economics 2
Credit Hours: 3

Instructor
Name: Shima Dewi Mutiara Trisna, M.Sc.
Phone: 081252849678
Email: shima.trisna@mail.ugm.ac.id
Office Hours for consultancy: by appointment, 3rd floor, West Wing
Class Meeting: Thursday, 13.30 - 16.00, Room: B-313

Course Description
International trade has played a significant role in the ability of countries to grow and develop. Some of the
questions will be addressed in this course are: What is the difference between local trade and international
trade? Why do countries trade? What determines the trade pattern? What are the gains from trade? What is
comparative advantage? How do factor endowments affect comparative advantage? How does trade
influence income distribution? Why do countries apply tariff and non-tariff barriers? What are the
implications of imposing tariffs? After discussing the basics of trade theory, this course will discuss several
economic models in order to get better understanding of economic mechanism and the policy issues.

Course Objectives
Upon completion of the course students are expected to be able to:
1. Understand trade concepts;
2. Understand how trade creates wealth;
3.Explain basic events and phenomena related with international trade; such as globalization and digitization.
4. Critically evaluate the claims of politicians and other policy makers regarding the welfare effects of their
proposal of international trade.

Learning Goals
Completion of the course contributes to the following learning goals and objectives:
Learning goal Objectives/Traits High Med Low Performance
Measurement
1. Students demonstrate 1.1 Students are able to structure their V
the ability to produce report coherently
written 1.2 Students are able to develop sound V
reasoning for their analysis
1.3 Students conform to a standard V
writing style
Learning goal Objectives/Traits High Med Low Performance
Measurement
2. Students demonstrate 2.1 Students are able to structure their V
the ability to deliver oral presentations coherently
presentations 2.2 Students are able to use the media V
effectively in deliver their presentations
2.3 Students are able to use effective V
presentations techniques to deliver their
presentations
2.4 Student are able to respond to V
questions effectively
3. Students demonstrate 3.1 Students demonstrate the ability to V
the ability to comprehend master the principles and concepts of
fundamental economic macroeconomic theories
principles, concept, and
theories 3.2 Students demonstrate the ability to V
master the principles and concepts of
microeconomic theories
4. Students demonstrate 4.1 Students are able to formulate V
the ability to formulate economic issues
a p p r o p r i a t e r e s e a r c h 4.2 Students are able to formulate an V
question appropriate research question
4.3 Students are able to intensively V
conduct an independent literature
review to approach the research
question
5. Students demonstrate 5.1 Students are able to show the V
t h e a b i l i t y t o a p p l y congruity between the research
appropriate analytical question and the method used to
tools approach it
5.2 Students are able to collect data V
5.3 Students are able to perform data V
analysis
6.1 Students are able to interpret their V
6.Demonstrated the ability analysis result
to interpret results 6.2 Students are able to suggest V
solutions based on their conclusion

Course Materials
Prescribed textbook:
Paul R. Krugman and Maurice Obstfeld. International Economics. Theory and Policy. Fifth Edition.
Addison-Wesley Publishing Company, 2000. (KO)
Dennis, R. Appleyard and Alfred J. Field, JR., International Economics. Fourth Edition. McGraw-Hill.
International Edition, 2001. (AF)

Recommended textbooks and readings:

Website relate to this course:
(http://comtrade.un.org/db/)
Additional reading materials will be provided by the lecturer every week. Materials will be uploaded on the
students’ portal 3 days before the class is conducted. Therefore, students are expected to check their
SINTESIS accounts prior to the session.
Student’s Responsibilities
Students are expected to attend all scheduled class meetings. Absence from class meetings shall not exceed
25%. Students who exceed the 25% limit without the excuses acceptable to and approved by the FEB rules
and regulations shall not be allowed to take the final exam.
Operating laptop, mobile phone, and other communication devices are strictly prohibited during class
meetings, unless asked to do so. Any student found operating these devices without the istructor permission
should leave the class and will be considered as an absence for the class meeting.
Academic Integrity
Academic integrity forms a fundamental bond of trust between colleagues, peers, lecturers, and students, and
it underlies all genuine learning. There is no tolerance for plagiarism or academic dishonesty in any form,
including, but not limited to, viewing the exams of others, sharing answers with others, using books or notes
while taking the exam, copying answers or papers, or passing off someone else’s work as one’s own. A
FAILURE OF AN ENTIRE COURSE (a grade of “E”).
The Department of Accounting FEB UGM does not tolerate academic dishonesty. All violation will be
recorded in the FEB systems. All of assignments and homework (if any) must be submitted both softcopy
and hardcopy, unless being asked differently. The softcopy will be checked using TURNITIN or AiMOS
(anti-plagiarism software). Ensure that your work has been check to AiMOS by login to https://
aimos.ugm.ac.id/user-management/auth/login prior to submission. Please refer to https://
paleffi.feb.ugm.ac.id/images/test/01-160801080151.pdf for anti-plagiarism guidelines.
For the first offense, a student who violates the academic integrity will receive a zero point for the
assignment (i.e. homework, quiz or exam). For the second offense, the student will receive a grade of “E” in
the course where the student commits the second. For the third offense, the Department will recommend that
the student be dismissed from the University.

Teaching Methods
1. The lecturer will explain the topic of that day at the beginning of the class. This explanation will be
shortly followed by discussion.
2. It is mandatory for students to read the main and additional reading materials before coming to class.
3. Students are expected to think critically, analytically, and creatively.

Grading
Your grade will be determined based on your total score on the following items:
Mid Exam = 30 %
Final Exam = 30 %
Assignments = 20 %
Presentation = 20 %
100%
Assignment
1. QAQR (Quote, Argument, Question/Comment, and Relevance). This is a weekly assignment where
students write commentaries on the most recent international economics events on the news. This
assignment is intended to asses students’ critical thinking through short academic essay.
2. Dragon’s Den Pitch. Students are going to be working in a group of 2-3. A case study on international
economics will be presented and the students pitch their solution to the problem.
Your final score will be mapped to a course grade based on the following scheme:
Nilai (Grade) Cut Off % Range Cumulative Weighted Grade
E 0 - 29 0
D 30 1
D+ 35 1,25
C/D 40 1,5
C- 45 1,75
C 50 2
C+ 55 2,25
B/C 60 2,5
B- 65 2,75
B 70 3
B+ 75 3,25
A/B 80 3,5
A- 85 3,75
A ≥90 4,0

Below is the explanation for each grade:

Grade Explanation
A Like A-, with consistent evidence of substantial originality and understanding in
identifying, producing and communicating conflicting arguments, perspectives or
problem solving approaches; critically evaluate the problem, its solutions and the
implications of the problem.
A- Like B+, with much evidence of originality in defining and analyzing issues or problems
and in creating solutions; using levels, styles and suitable communication means to the
discipline of science and audience.
A/B and B+ Demonstrate a substantial understanding of basic concepts in various contexts; develop or
adapt convincing arguments and provide a comprehensive justification; communicating
information and ideas adequately in terms of disciplinary conventions.
B Demonstrate adequate understanding and application of basic concepts from the field of
study; building arguments or decisions and providing acceptable justification;
communicating information and ideas adequately in terms of disciplinary conventions.
B- to C Demonstrate a superficial or partial or erroneous (faulty) understanding of basic concepts
of the field of study and the limited ability to apply the concepts; giving an unsupported
or improper argument; communicate information or ideas with unclear and inconsistent
compliance with disciplinary conventions.
C- to D+ Demostrate a real shortcoming in understanding and applying underlying concepts;
communicate the ideas and informations in incomplete ways or confusing and give just
little attention the conventions of the science field.
D Fail to demonstrate the major part or the whole part of learing goals.
E There is no work that can be graded.

Course Outline
Meeting Topic Reference CO
1 Introduction KO Ch. 1; AF
Ch. 1-2
The world of international trade
Mercantilism
Absolute advantage
In this part, we discuss the role of international trade in
economy and the glance of the course.
Case Study: Trends in the world trade
2 The Classical Theory of Trade: Ricardian Model KO Ch. 2; AF QAQR I: 400
Ch. 3 words
Assumptions and Model
PPF
Website:
This part describes firstly a general introduction to the concept
of comparative advantage, and then proceeds to develop a h t t p : / /
specific model of how comparative advantage determines the comtrade.un.o
pattern of international trade. rg/db/
Case Study: Product Classifications
3 Extensions and Tests of the Classical Model of Trade KO Ch. 2; AF Q A Q R I I :
Ch. 4 500 words
Exchange rate
The Dornbush-Fischer-Samuelson (DFS) model
This part discusses the extension and test of the classical model
of trade. Assignment 1
Case Study: How to investigate a country’s comparative
advantage
Website:
h t t p : / /
comtrade.un.o
rg/db/
4 Introduction to Neoclassical Trade Theory: Tools to Be KO Ch. 3; AF Q A Q R I I I :
Employed Ch. 5 600 words
Consumer behavior and Production theory
The Edgeworth box diagram
This part describes the analytical tools employed in the entire
course: production possibility frontier (PPF) and Indifference
curve (IC).
5 Gains from Trade in Neoclassical Theory KO Ch. 3; AF Q A Q R I V:
Ch. 6 700 words
Autarky equilibrium
Equilibrium with international trade
By using the PPF and IC, this part examines the equilibrium of
trade and gains from trade.
Meeting Topic Reference CO
6 The Basis for Trade: Factor Endowments and the Heckscher- Q A Q R V:
Ohlin Model 1000 words
Assumptions and model
KO Ch. 4; AF
The Stolper-Samuelson theorem Ch. 8
The international trade is largely driven by differences in factor
endowments. The Heckscher-Ohlin theory deals with this issue.
In this part, we discuss the H-O theory.
Case Study: Products classifications by factor intensity

S h o r t
presentation
We b s i t e :

h t t p : / /
people.few.eu
r . n l /
vanmarrewijk
/eta/
7 Empirical Test of the Factor Endowments Approach KO Ch. 4; AF
Ch. 9
Leontief paradox
This part discusses the empirical test of the factor endowments
approach, especially the Leontief paradox.
Case Study: Factor Endowments and Comparative Advantage of
the East Asia
MID EXAM
8 Offer Curve and the Terms of Trade KO Ch. 5; AF
Ch.7
Offer curve
Term of trade (TOT)
S h o r t
Equilibrium of trade presentation
In this part, we discuss the standard trade model.
9 Post-Heckscher-Ohlin Theories of Trade and Intra-industry KO Ch. 6; AF Group 1 vs
Trade Ch. 10 Group 2
Product Cycle theory
The Krugman model
Other models Assignment 2
Intra-industry trade
This part scrutinizes the role of a different kind of increasing
returns, external economies in determining trade patterns.
S h o r t
Case Study: Intra- and inter-industry trade presentation
Website:
h t t p : / /
comtrade.un.o
rg/db/
Meeting Topic Reference CO
10 Economic Growth and International Trade AF Ch. 11 Group 3 vs 4
Trade effects
Sources of growth
Small- and Large-countries
In this part, we discuss the relation between international trade S h o r t
and economic growth presentation
Case Study: The economic and environment impact of trade
liberalization
11 International Factor Movements KO Ch. 7; AF Group 5 vs 6
Ch. 12
FDI
Labor movements
Assignment 3
This part is concerned with another form of integration,
international movements of factor of production, or factor
movements which include labor migration, the transfer of
capital via international borrowing and lending, and the subtle Website:
international linkages in the formation of multinational h t t p : / /
corporations. comtrade.un.o
Case Study: The “Flying Geese” pattern in the East Asia rg/db/

S h o r t
presentation
12 The Instruments and the impacts of Trade Policy KO Ch. 8; AF
Ch. 13
Tariffs
Non-tariff barriers
This part examines the policies that governments adopt toward
international trade policies. S h o r t
presentation
Case Study: Structure of protection
13 The Arguments of Trade Policies KO Ch. 9; AF
Ch. 14
Small country case
Large country: partial equilibrium
Large country: general equilibrium
This part discusses the arguments of trade policies
S h o r t
Case Study: The economic and environment impact of trade presentation
liberalization
Meeting Topic Reference CO
14 Trade Policies in Developing and Advanced Countries PK-22
Import-substitution KO Ch.
10-11; AF Ch.
Export-oriented 14
Strategic trade policy
This part discusses trade policies in developing and advanced
countries.
Case Study: East Asia
S h o r t
presentation
FINAL EXAM

Important Notes
Every student will have opportunities to present one of the case studies in the textbooks. The lecturer will
give other case studies.