Kinh Tế Vi Mô 1: Lợi và Hại từ Thương Mại | Microeconomics | Trường Đại học Quốc tế, Đại học Quốc gia Thành phố Hồ Chí Minh

Phần 9-2 : The Winners and Losers from Trade
9-2a: The Gains and Losses of an Exporting Country
● With trade, the domestic price rises to meet the world price
● Exporting: The quantity supplied is greater than demanded so sell to other countries
○ Still at equilibrium because the rest of the world demand equals countries supply
● World price above equilibrium -> export ● Conclusions:
○ Exporters—domestic producers are better off and domestic consumers are worse off.
○ Trade raises the economic well-being of a nation, in that the
gains of the winnersexceed the losses of the losers 2
9-2b: The Gains and Losses of an Exporting Country
● The quantity supplied is less than the demanded. The difference
between them is bought from other countries -> become importer
● World price below equilibrium ● Conclusion:
○ Importers: domestic consumers are better off and domestic producers are worse off
○ Raises economics well-being because gains of winners is greater than losses of losers
9-2c: The Effects of a Tariff
● Tariff—tax on goods produced abroad and sold domestically (for imports)
○ Raises price on imported goods above the world price -> domestic price increase
○ Demand decreases and supply increases
● Tariff reduces quantity imported and moves domestic market
closer to its equilibrium without trade
● Domestic sellers better off, domestic buyers worse off, government raises revenue
● Change in consumer surplus (negative), producer surplus and government revenue (positive) ● Deadweight loss 3
○ Area that is lost from consumer surplus and not gained from government revenue from tariff
○ Sum of overproduction and under-consumption
● Tariff distorts incentives and pushes allocation of resources away from optimum ● Effects of Tariff
○ Encourages domestic producers to increase supply (with high cost producers)
○ Reduces consumption as a result of raise price
9-2d: The Lessons for Trade Policy
● With trade, prices in country will be driven to equal world price
○ If our price below the world price, it will rise ->reduce the
amount of consume, raise the amount of produce -> export
due to having an advantage in producing, and vice versa
● If prices rise, producers gain and consumers lose, and vice versa
○ Gains are always larger than losses, so total welfare rises
● Tariff only effects if country imports.
○ Improves welfare of domestic producers and raises
government revenue, but losses from the consumers
9-2e: Other Benefits of International Trade
● Increased variety of goods from different countries
● Lower costs through economies of scale - goods produced at low
cost when produced inlarge quantities 4
○ Free trade gives access to larger world markets that can
realize economies of scale more fully
● Increased competition - trade fosters competition and prevents market power (monopoly)
● Enhanced flow of ideas - transfer of technological advantages is linked to trade