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Econ 3970: Law & Economics of International Trade

Econ 3970

Law & Economics of International Trade

 

Professor:  Douglas Nelson

Office: Tilton 108 (Murphy Institute), Phone: 865-5317

Office Hours: Monday and Wednesday, 3:00-5:00

Phone: 865-5317

email: dnelson@tulane.edu

Webpage: http://nelson.wp.tulane.edu/

 

In 2016, for the first time since before the Second World War, national international trade policies and the international arrangements providing a (relatively weak) regulatory framework have become significant public political issues in virtually all of the core countries of the liberal international trading system.  The readings and lectures in this course seek to develop an understanding of the domestic and international foundations of international trade law. Positive law and economics is a branch of political economy, not a branch of welfare economics.  We begin the course with some background in the economics and politics of a liberal international economy.  Then we examine the role of law in a democratic, capitalist political economy.  Having laid this foundation, we turn to detailed analysis of the way that system seeks to balance the gains from integration with losses of sovereignty.  Then we consider a number of new issues facing the liberal international trading system: restructuring of the world economy to take advantage of global value chains; and the emergence of China as a significant economic and political actor.  Finally, we examine some sources of crisis and potential alternatives.  Our main international focus will be the World Trade Organization (WTO), though we will consider other multilateral and plurilateral organizations in passing; and our analysis of national policy with focus on the United states, though we will consider other countries in passing.

 

Evaluation: Your performance in this course will be evaluated on the basis of 2 examinations (worth points 100 points each) and 6 tutorial papers (worth a total of 100 points). To receive an A, you must earn at least 90 percent of the points available.  To pass the course you must earn at least 60 percent of the points available.  Grades between these limits will be determined on the basis of your performance relative to that of the class as a whole.

Readings for the course will be drawn from:

Bernard Hoekman & Michel Kostecki (2010). The Political Economy of the World Trading System: The WTO & Beyond. Oxford University Press. [Hoekman/Kostecki]

Many readings, most available online and linked from the online version of this syllabus.

Although not available from the bookstore, we will draw a couple of chapters (available in Canvas) from:

Henrik Horn & Petros Mavroidis (2013). Legal and Economic Principles of World Trade Law. Cambridge: Cambridge University Press. [Horn/Mavroidis]

If you are interested in more detail, the authors of the above book have produced more advanced and longer texts that are very good, indeed:

Petros Mavroidis (2016). The Regulation of International Trade: GATT. MIT Press.

Petros Mavroidis (2016) The Regulation of International Trade: The WTO Agreements on Trade in Goods. MIT Press.

Petros Mavroidis (2020). The Regulation of International Trade: The General Agreement on Trade in Services. MIT Press.

An interesting attempt to explain key economic concepts to lawyers in the context of a philosophically informed framework is.

Robin Malloy (2004). Law in a Market Context: An Introduction to Market Concepts in Legal Reasoning. Cambridge University Press.

An excellent book on how capitalism works, and sometimes doesn’t, is

John McMillan (2002). Reinventing the Bazaar: A Natural History of Markets. New York: Norton.

For an excellent non-specialist analysis of the development and current challenges of globalization, your can’t do better than:

Richard Baldwin (2016). The Great Convergence: Information Technology & the New Globalization. Cambridge, MA: Harvard University Press.

Examination format.  The format for both exams will be: about 40% short answer questions and about 60% essays.  In general there will be more questions of both types than must be answered, so you will have some choice (though there is often one mandatory question which everyone must answer).  The exams must be written in blue books, which you must supply

Policy on examinationsThe midterm exam will be taken during the class period on 12 October. Unless you have a standard university accepted excuse for missing the exam (e.g. health), you must take the exams at their scheduled time. If you miss the first exam there will be a makeup exam (given during finals week). Note: to be eligible to take a makeup exam you must have a legitimate excuse for having missed the regular exam. The final examination will only be given on the scheduled date: Monday, 13 December 8:00-11:00 (there will be no exceptions so do not make travel plans that conflict with this).

Policy on short papers. I will divide the class into 3 groups. Every week, all members of one of those groups (to be specified on the first day of class) will prepare a paper on that week’s reading. The papers should identify and discuss some significant element of that week’s readings. The papers should be 3 or 5 pages long and, on a separate page, should include 5 questions for the group to discuss.

Some Good Advice (At No Extra Charge): First, keep current with the reading.  Second, ask questions in class.  If you read something and it is unclear and then it is unclear during lecture, ask about it.  Your classmates will probably thank you.  This is one of the few ways, before an exam, that I can gauge how the material is getting across.  Third, come see me during my office hours.  This is another opportunity to get clarification and help on material about which you are unclear.  But don’t wait until the last minute, by then it is usually too late.

 

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Per Tulane’s religious accommodation policy (with hyperlink), I will make every reasonable effort to ensure that students are able to observe religious holidays without jeopardizing their ability to fulfill their academic obligations. Excused absences do not relieve the student from the responsibility for any course work required during the period of absence. Students should notify me within the first two weeks of the semester about their intent to observe any holidays that fall on a class day or on the day of the final exam.

 

SACS-Related Material

I am aware that Tulane students are able to read a standard university syllabus and determine the content of the course and its relation to the major and the individual student’s course of study. However, the administration of Tulane University, along with the Southern Association of Colleges and Schools (SACS–which “accredits” primary and secondary schools as well as all varieties of 2 and 4 year undergraduate programs [with very little in the way of adjustment in rubrics, metrics, etc.]), has determined that you require additional information. I collect this material in a separate section so that you can refer to it, or discard it, as you consider appropriate.

Relevant Program Outcomes Addressed in this Course:

  1. Understand and be able to apply basic economic analysis of trade policy.
  2. Understand the role of law in the links between the economy, civil society and the state in democratic capitalist countries and the extension of this analysis to a world of democratic capitalist countries.
  3. Understand the main elements of the legal structure regulating trade between nations.  In particular, the way the detailed structure of the global trading system seeks to balance the gains from interdependence and the claims of sovereignty essential to any democratic political system.
  4. Use the tools of economic, political and legal analysis to identify the current pressures for change in the global trade regime.
  5. Use the tools of economic, political and legal analysis to evaluate current proposals for change in the global trade regime.

Learning Objectives”: Upon completion of this course you should have developed a practical knowledge of:

Economic analysis of trade and related policies (i.e. application of the theory of economic policy);

Core concepts of legal analysis with particular application to economic relations in general and international trade relations in particular;

The functioning of the main institutions regulating international trade, with specific reference to the World Trade Organization, but extended to other arrangements.

 

 

Econ 3970                                    SYLLABUS                                     Fall 2021