ECO100Y5 Chapter Notes - Chapter 8: Autarky, Import Quota, Killer Whale

• School: UTM
• Department: Economics
• Course: ECO100Y5
• Professor: Michael H O

Document Summary

Goods and services purchased from other countries are imports; goods and services sold to other countries are exports. Globalization is the phenomenon of growing economic linkages among countries. The ricardian model of international trade analyzes international trade under the assumption that opportunity costs are constant. Autarky is a situation in which a country does not trade with other countries. Sources of comparative advantage: differences in climate, differences in factor endowments. The factor intensity of production of a good is a measure of which factor is used in relatively greater quantities than other factors in production. According to the heckscher-ohlin model, a country has a comparative advantage in a good whose production is intensive in the factors that are abundantly available in that country: differences in technology. The domestic demand curve shows how the quantity of a good demanded by domestic consumers depends on the price of that good.