AØKA08062U International Trade and Investment: Theory and Policy

Volume 2013/2014
MSc in Economics

General and partial equilibrium trade theory, empirical results, political economy, organization of the multinational firm, application of trade theory to the globalization process.

  • Introduction to the course
  • Discussion – the Globalization process (supplementary)
  • The Ricardian Model and two-sector, two-factor model
  • The Heckscher-Ohlin Model
  • Many goods and factors
  • Trade in intermediate inputs and wages
  • Gains of trade and the WTO (supplementary)
  • Political Economy of Trade Policy
  • Multinationals and the Organization of the Firm
  • Discussion – the Globalization process (supplementary)
  • Summary
Learning Outcome
The objective of this graduate-level course is to equip students with in-depth understanding of the theory of international trade and expose them to most recent theoretical and empirical research in this area so that they can understand articles in academic and policy journals in the field. Models seeking to explain the causes, patterns and consequences of international trade are presented graphically and derived mathematically. Empirical studies of these models are examined and criticized on their ability to confirm or refute predictions of the model. The political economy of trade policy and the organization of the multinational firm are studied, including the evolution from multinational corporation to globally integrated enterprise. At the beginning and the end of the course, it is discussed how the theories relate to the ongoing globalization process.

Required readings:

  • Robert C. Feenstra (2004) Advanced International Trade: Theory and Evidence – chapters 1, 2, 3, 4, 5, 9 and 11.
  • Sam J. Palmisano ‘The Globally Integrated Enterprise’, Journal of Foreign Affairs May/June 2006.


Supplementary Readings :

  • ‘6 Truths from 2006 - The Search for a Post-Financial Crisis Paradigm for Globalization', presentation by Tim Mondorf at Copenhagen University, Department of Political Science Summer School on China 10th of August 2012 (powerpoint).
  • Robert C. Feenstra (2004) Advanced International Trade: Theory and Evidence Chapter 6
  • WTO Annual Report 2012 Chapter 3 ‘Trade Negotiations’
  • Multilateralism at a Cross-Roads’, speech by WTO Director General Pascal Lamy 26th of June 2012
Mandatory courses from B.Sc.
3 hours of lectures per week for 14 weeks.
  • Category
  • Hours
  • Exam
  • 3
  • Lectures
  • 42
  • Preparation
  • 161
  • Total
  • 206
7,5 ECTS
Type of assessment
Written examination, 3 hours under invigilation
Written examination takes place at Peter Bangs Vej 36
Without aids
Marking scale
7-point grading scale
Censorship form
External censorship
100 % censurship
Exam period
Will be updated before the start of the semester
Same as ordinary. But if only a few students have registered for the re-exam, the exam might change to an oral exams with a synopsis to be handed in. This means that the examination date also will change.
Criteria for exam assesment
The Student must in a satisfactory way demonstrate that he/she has mastered the learning outcome of the course.