78360 - International Trade in Services

Course Unit Page


This teaching activity contributes to the achievement of the Sustainable Development Goals of the UN 2030 Agenda.

Decent work and economic growth Reduced inequalities Climate Action Partnerships for the goals

Academic Year 2022/2023

Learning outcomes

The course aims to build knowledge and understanding in the area of international trade, particularly focusing on the service sector. To the end the course will provide an understanding of the intellectual and practical problems that arise from the economic interaction between countries and offer explanations of the international pattern of trade and specialisation.

Course contents

1. Globalization and its discontents

a) Key concepts and key facts

b) Opposite views

2. Cause and Consequences of International Trade

a) North-South Trade: The Comparative Advantage Theory

- The Ricardian Model

- The Specific Factors Model

- The Factor Proportions Model

b) North-North Trade: Economies of Scale and Imperfect Competition

3. Trade Policy

a) The Instruments of Trade Policies

b) The Political Economy of Trade Policies

4. International Factor Movements, Globalization, and Developing Countries

a) Foreign direct investment and migration

b) Offshoring, outsourcing, and licensing

c) Trade policy in developing countries

d) Controversies about the WTO and globalization (intellectual property rights, labor standards, trade and environment)



P. Krugman, M. Obstfeld, M. Melitz, "International Economics: Theory and Policy”, 11th Edition, Pearson, 2018.

R. Feenstra, A. Taylor, "International Economics", 3rd Edition, Macmillan, 2014.

Required Readings:

S. Barrett, “Environment and Statecraft”, Oxford University Press, Oxford, 2003. (chapters 3-4)



K. Maskus, "Intellectual Property Rights in the Global Economy", Institute for International Economics, 2000 (chapter 3).


K. Maskus, “Should core labor standards be imposed through international trade policy?”, World Bank Policy Research Working Paper No. 1817, 1997


H. Nordstrom, S. Vaughan, "Trade and Environment: Special Studies 4", World Trade Organization Report, Geneva, 1999 (chapter 3).


Supplementary Readings:

R. E., Baldwin, "Globalization: The Great Unbundling(s) ", working paper, Economic Council of Finland, 2006.

R. Freeman, "Are your Wages Set in Beijing?", Journal of Economic Perspectives 9(3), 15-32, 1995.

W. Martin, K. Maskus, "Core Labor Standards and Competitiveness: Implications for Global Trade Policy", Review of International Economics, 9(2), 317-328, 2001.

K. Maskus, “The Role of Intellectual Property Rights in Encouraging Foreign Direct Investment and Technology Transfer”, Duke Journal of Comparative and International Law 9, pp. 109—161, 1998.

P. Samuelson, "Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization", Journal of Economic Perspectives 18(3), 135-146, 2004.

P. Krugman, M. Obstfeld, " Study Guide" (solutions to exercises in the book and additional exercises)

Teaching methods

During the 60 teaching hours, respective arguments will be confronted in the order indicated in the program. After the presentation of the underlying theory behind the topic under study, the political economy applications of each and relevant exercises will be carried out.

Assessment methods

The group exercises carried out during class will account for 25% of the final grade. There are 7 exercises, 4 points each, summing up to 28 points (out of 25) for those who attend all exercises and achieve a perfect grade. The exercise grades can be carried to the second and third exam date.

The course will be concluded by a written examination, which will last 1.5 hours and account for the other 75% of the final grade. The exam consists of exercise-style problem sets.

The maximum possible score is 30 cum laude, in case all anwers are correct, complete and formally rigorous.

The grade is graduated as follows:

<18 failed
18-23 sufficient
24-27 good
28-30 very good
30 e lode excellent

For those who do not attempt the exercise (not recommended), the final exam will account for 100%. It will be a longer exam (2 hours) and will include an extra essay question.

Students can reject the grade obtained at the exam once. To this end, he/she must email a request to the instructor within the date set for registration. The instructor will confirm reception of the request within the same date.


Teaching tools

Lectures, exercises.

Office hours

See the website of Alireza Jay Naghavi