A) Review and critically examine the main international trade theories both classical and modern. Show that you understand the theoretical basis of each and explain the reasoning which leads to the predictions they make. How valid are these predictions in the light of contemporary evidence and what are the limitations, if any, of each theory you are evaluating?
B) Over the last 3 to 4 decades international trade has grown much more quickly than the world economy in general and most individual national economics in particular until the financial crisis of 2008 when there was a reversal in growth until growth recovered in 2010. International trade theory predicts that trading nations will benefit from international trade in terms of raising levels of real income and prosperity and stimulating their economic growth. Evaluate the extent to which this has happened supporting your answer with real world examples with which you are familiar or have researched.
C) The expectation by economists is that international trade will stimulate economic growth of the world economy and raise incomes of participating trading nation states has led to the formation and expansion of the WTO designed to liberalize world trade. Trading Blocs such as the EU, NAFTA and ASEAN promote free trade within the blocs but some protectionism from outside . With reference to International theories identified in the lecture on ‘Introduction to International Trade Theories’ (week 1) are there any drawbacks and limitations to the increased liberalization and expansion of free trade for trading nations? If so is there a good case for protectionism in certain circumstances? If so explain in which circumstances this may be preferred and if not explain why not.