国际贸易学(英)第3章概要1.pptVIP

* 经济学院 柳哲 Chapter 3 The Standard Theory of International Trade Chapter 3 The Standard Theory of International Trade 3.1. The Production Frontier with Increasing Costs Increasing opportunity costs mean that the nation must give up more and more of one commodity to release just enough resources to produce each additional unit of another commodity. 0 10 30 50 70 90 110 130 Nation 1 y x y - x A B y3 y1 y2 y4 y5 y1y2y2y3y3y4 y4y5 140 120 100 80 60 40 20 y x A’ B’ Nation 2 X4 X3 X2X1 X1x2x2x3x3x4 Production Frontiers of Nation 2 with increasing costs 3.1.2 Reasons for increasing opportunity costs and different Production frontiers a. Resources or factors of production are not homogeneous b. Resources or factors of production are not used in the same fixed proportion or intensity in the production of all commodities. The difference in the production frontiers of two nations is due to the fact that the two nations have different factor endowments or resources at their disposal and /or use different technologies in production. c. 3.2 Community Indifference Curves 3.2.1 Illustration of community indifference curves A community indifference curve shows the various combinations of two commodities that yield equal satisfaction to the community or nation. N Nation 1 0 10 30 50 70 90 100 80 60 40 20 H E T C I II III Y X A B D 3.2.2 The marginal Rate of Substitution (MRS) MRS of X for Y in consumption refers to the amount of Y that a nation could give up for one extra unit of X and still remain on the same indifference curve. In Nation 1 ,the substitution of x for y ,MRS(N) MRS(A) The decline in MRS or absolute slope of an indifference curve is a reflection or the fact that the more of X and the less of Y a nation consumes; The declining slope of the curve reflects the diminishing marginal rate of substitution (MRS)