In this course, we consider the effects of globalization on the economic welfare from not only the international but also the domestic viewpoint. To this end, we need to concrete the concept of globalization in a specific form that is suitable for our argument. We focus on three economic aspects of globalization, namely international trade, international finance and international aid.
Firstly, we pick up the international trade that can be seen the most basic means to bring about welfare among participating nations. In principle, the international trade gives more or less benefit to every nation involved in the trade, but in reality it has some negative effects as well.
Thus, first of all, I will briefly lecture on the fundamental principle of the international trade in which students will understand the reason why every participating country can receive benefit through the international trade. In the process, what is more important, students have a chance to grasp the specific view of welfare in economics. Incidentally, I will provide a brief explanation on the basic structure of economics if there are many students in the class who are unfamiliar with economics.
Then, we turn to negative effects of the international trade that are observed in reality. These effects are conceptually divided into two categories; one is domestic and the other is international. In order for students to understand these effects, it is advisable from the pedagogical viewpoint to give some real event so that students can hold a vivid image for it. As for the former (domestic) case, I will pick up TPP (Trans Pacific Partnership) and investigate its negative influence that agreement, if concluded, will have in Japan. Our argument will be centered on the damage Japan’s agricultural industry will suffer. On the other hand, as the latter (international) case, we will mention the so-called south-north problem in which the north developed nations can take advantage of the trade while the south under-developing nations are exploited by the trade, which results in increased inequality in different areas in the world.
Secondly, we deal with the international finance in which money and capital instead of real goods play the major roles. This means that the working of the international finance and their effects on welfare are different from the international trade. Students may feel it a little difficult to understand them. So, first I will give some lecture on it. After understanding the fundamental mechanism of the international finance, students will learn problems that may happen in the real world. As an example, I pick up the 2008 financial crisis and analyze its consequences over the world.
Lastly, I refer to the international aid that is implemented by developed countries to under-developing countries. The international aid is not trade, thus does not cause a problem like the south-north problem. Our focus should therefore be set on how the aid improves welfare of a recipient country. In reality, some countries enjoy welfare improvement through aid, others fail to do despite it. We pay attention to the latter case and investigate reasons that prevent them from welfare improvement. To this end, many interdisciplinary factors should be taken into account.
Learning outcomes of the course
In this course, students are expected to understand a specific angle of economics to approach to globalization and also a specific way of evaluating welfare in economics. In addition, students will see why and how the realities are different from what the theory indicates.
Teaching and evaluation methods
Teaching method: In addition to lectures, I will regularly impose seminar papers. Discussion time is also set occasionally, in which discussion will be led by someone’s presentation.
Evaluation method: the mid-term evaluation is based on attendance, seminar paper, presentation and discussion. For the final grade, an exam is added to them.
Percentage of the final grade assigned to each evaluation: attendance and discussion 10%, seminar paper 30%, exam 60%
Week 1: Welfare in economics
(1) Utility and welfare
(2) Consumption and utility
Week 2: Economic welfare in pre-globalization
(1) Closed economy model
(2) Market mechanism and equilibrium
Week 3: International trade as a form of globalization
(1) Import and export
(2) Effect of international trade on welfare
Week 4: Trade conflict 1
(2) welfare effect of tariff
Week 5: Trade conflict 2
(1) Game theory
Week 6: International finance as a form of globalization 1
(1) Effect of finance in closed economy
Week 7: International finance as a form of globalization 2
(1) Effect of finance on open economy
(2) Equilibrium in exchange market
Week 8: Globalization and economic development 1
(1) International trade and developing countries
(2) Import substitution policy
Make up class (Friday) Export promotion policy
Week 9: Discussion
Week 10: Globalization and economic development 2
(1) International finance and economic development
(2) Foreign aid
Week 11: Globalization and environmental problem
(1) International trade and environmental problem
(2) International finance and environmental problem
(2) Overall summary
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