IBUS2301 - Tutorial #3 - Chapters 7 and 9 - Political economy of trade and REI

•

3 likes•1,076 views

In this tutorial, we cover two scenarios related to the issues of government intervention and regional economic integration. Scenario 1 concerns the ongoing dispute between the U.S. and many countries in South America and Africa over the U.S.'s farming subsidies. Scenario 2 concerns a country's decision to join or not join a regional trade agreement, in this case Norway's decision to not join the E.U.

Business

IBUS2301:
Int’l Business Mgmt
2 SCENARIOS

IBUS2301:
Int’l Business Mgmt
2 Scenarios
• 4 groups
• 2 judges
• 7 minutes to prepare
• 2 minutes to present

Scenario #1
There is a long-running dispute between Brazil and the
United States over U.S. cotton subsidies. These
subsidies have included direct payments to producers
and paying significant portions of their insurance
premiums.
Group 1: You support the use of subsidies in this case.
Make the case as to why, and how, these should be
continued.
Group 2: You recommend that the U.S. should quickly
change its subsidy program. Explain why and how
this should be done.

Scenario #2
Along with Iceland and Switzerland, Norway is one of
the few countries in Western Europe to not join the
European Union. There are currently 28 member states
in the E.U.
Group 3: You support Norway’s decision to not join the
E.U. Make the case as to why this is the best
decision.
Group 4: You recommend that Norway should apply for
E.U. membership. Explain why.

IBUS2301:
Int’l Business Mgmt
GOVERNMENT INTERVENTION

3/25/2014
IBUS2301:
Int’l Business Mgmt
For
• Protect jobs and consumers
• National security
• Retaliation
• Foreign policy objectives
• Protecting human rights
• Infant industry & FMA
Against
• Inefficient use of tax dollars
• Increases costs to
consumers
• Trade wars
• WTO violations
Government
Intervention
What are the arguments for and against government
intervention in international trade?

Source: www.just-style.com/news (full URL in notes)

IBUS2301:
Int’l Business Mgmt
REGIONAL ECONOMIC INTEGRATION

IBUS2301:
Int’l Business Mgmt
REI
For
• Free trade arguments
• Less parties to negotiate
• Political cooperation
• Regional power
• Reduces complexity
Against
• Loss of sovereignty
• Winners and losers
• Regionalization
– Trade diversion
What are the arguments for and against regional
economic integration?

Source: The New York Times (URL in notes)

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IBUS2301 - Tutorial #3 - Chapters 7 and 9 - Political economy of trade and REI

1. IBUS2301: International Business Management Tutorial #3, March 24 and 25 Chapters 7 and 9: Political Economy of Trade and REI Tutor: Preston Teeter, p.teeter@business.uq.edu.au

2. IBUS2301: Int’l Business Mgmt Outline • 2 scenarios • Government intervention • Regional economic integration

3. IBUS2301: Int’l Business Mgmt 2 SCENARIOS

4. IBUS2301: Int’l Business Mgmt 2 Scenarios • 4 groups • 2 judges • 7 minutes to prepare • 2 minutes to present

5. Scenario #1 There is a long-running dispute between Brazil and the United States over U.S. cotton subsidies. These subsidies have included direct payments to producers and paying significant portions of their insurance premiums. Group 1: You support the use of subsidies in this case. Make the case as to why, and how, these should be continued. Group 2: You recommend that the U.S. should quickly change its subsidy program. Explain why and how this should be done.

6. Scenario #2 Along with Iceland and Switzerland, Norway is one of the few countries in Western Europe to not join the European Union. There are currently 28 member states in the E.U. Group 3: You support Norway’s decision to not join the E.U. Make the case as to why this is the best decision. Group 4: You recommend that Norway should apply for E.U. membership. Explain why.

7. IBUS2301: Int’l Business Mgmt GOVERNMENT INTERVENTION

8. 3/25/2014 IBUS2301: Int’l Business Mgmt For • Protect jobs and consumers • National security • Retaliation • Foreign policy objectives • Protecting human rights • Infant industry & FMA Against • Inefficient use of tax dollars • Increases costs to consumers • Trade wars • WTO violations Government Intervention What are the arguments for and against government intervention in international trade?

9. Source: The Economist (URL in notes)

10. Source: AG Professional (URL in notes)

11. Source: www.just-style.com/news (full URL in notes)

12. IBUS2301: Int’l Business Mgmt REGIONAL ECONOMIC INTEGRATION

13. IBUS2301: Int’l Business Mgmt REI For • Free trade arguments • Less parties to negotiate • Political cooperation • Regional power • Reduces complexity Against • Loss of sovereignty • Winners and losers • Regionalization – Trade diversion What are the arguments for and against regional economic integration?

14. Levels of Economic Integration

15. Source: EurActive (URL in notes)

16. Source: The New York Times (URL in notes)

17. Source: EuroNews (URL in notes)

18. Questions?