ADM 3318 Lecture Notes - Lecture 4: Protectionism, Absolute Advantage, Mercantilism

• School: University of Ottawa
• Department: Administration
• Course: ADM 3318
• Professor: Tyler Chamberlin

Document Summary

> external codes of ethics: religion, laws, corporate documents. > our internal feelings - something may be legal, but is it acceptable? (socially?, personally?) > major theories typically studied concepts of mercantilism, absolute advantage, and comparative advantage: modern trade theories. > major theories typically study concepts of product life cycle, strategic trade, and national competitive advantage. > idea that governments should actively protect domestic industries from imports and vigorously promote exports. > trade is a zero-sum game: factor endowments. > extent to which different countries possess various factors, such as labour, land, and technology: factor endowment theory (heckscher-ohlin theory) > the proposition that nations will develop comparative advantage based on their locally abundant factors: resource mobility. > assumption that a resource removed from one industry can be moved to another: free trade. > idea that free market forces should determine how much to trade with little (or no) government intervention: theory of absolute advantage.