克魯格曼國(guó)際經(jīng)濟(jì)學(xué)答案

PAGEPAGE5Chapter6Foreachofthefollowingexamples,explainwhetherthisisacaseofexternalorinternaleconomiesofscale:MostmusicalwindinstrumentsintheUnitedStatesareproducedbymorethanadozenfactoriesinElkhart,Indiana.AllHondassoldintheUnitedStatesareeitherimportedorproducedinMarysville,Ohio.AllairframesforAirbus,onlyproduceroflargeaircraft,areassembledinToulouse,France.Hartford,ConnecticutistheinsurancecapitalofthenortheasternUnitedStates.Externaleconomiesofscale:Casesaandd.Theproductionsofthesetwoindustriesconcentrateinafewlocationsandsuccessfullyreduceeachindustry'scostsevenwhenthescaleofoperationofindividualfirmsremainssmall.Externaleconomiesneednotleadtoimperfectcompetition.Thebenefitsofgeographicalconcentrationmayincludeagreatervarietyofspecializedservicestosupportindustryoperationsandlargerlabormarketsorthickerinputmarkets.Internaleconomiesofscale:Casesbandc.Bothofthemoccurattheleveloftheindividualfirm.Thelargertheoutputofaproductbyaparticularfirm,theloweritsaveragecosts.Thisleadstoimperfectcompetitionasinpetrochemicals,aircraft,andautos.Inperfectcompetition,firmsetpriceequaltomarginalcost.Whyisn’tthispossiblewhenthereareinternaleconomiesofscale?Unlikethecaseofperfectlycompetitive markets,undermonopolymarginalrevenueisnotequaltoprice.Theprofitmaximizingoutputlevelofamonopolistoccurswheremarginalrevenueequalsmarginalcost.Marginalrevenueisalwayslessthanpriceunderimperfectlycompetitivemarketsbecausetosellanextraunitofoutputthefirmmustlowerthepriceofallunits,notjustthemarginalone.Itisoftenarguedthattheexistenceofincreasingreturnsisasourceofconflictbetweencountries,sinceeachcountryisbetteroffifitcanincreaseitsproductioninthoseindustriescharacterizedbyeconomiesofscale.Evaluatethisviewintermsofboththemonopolisticcompetitionandtheexternaleconomymodels.Bothinternaleconomiesofscale(whichmayleadtomonopolisticcompetition)andexternaleconomiesofscalecouldleadtoincreasingreturns.Byconcentratingtheproductionofeachgoodwitheconomiesofscaleinonecountryratherthanspreadingtheproductionoverseveralcountries,theworldeconomywillusethesameamountoflabortoproducemoreoutput.Inthemonopolisticcompetitionmodel,theconcentrationoflaborbenefitsthehostcountry.Thehostcountrycancapturesomemonopolyrents.Buttherestoftheworldmayhurtandhavetofacehigherpricesonitsconsumptiongoods.Intheexternaleconomiescase,suchmonopolisticpricingbehaviorislesslikelysinceimperfectlycompetitivemarketsarelesslikely.Supposethetwocountriesweconsideredinthenumericalexampleonpages132-135weretointegratetheirautomobilemarkerwithathirdcountrywithanannualmarketfor3.75millionautomobiles.Findthenumberoffirms,theoutputperfirm,andthepriceperautomobileinthenewintegratedmarketaftertrade.FACXc1 SPcSXn

PAC n2

n15.8However,sinceyouwillneversee0.8firms,therewillbe15firmsthatenterthemarket,not16firmssincethelastfirmknowsthatitcannotmakepositiveprofits.Therestofthesolutionisstraight-forward.UsingX=S/n,outputperfirmis41,666units.Usingthepriceequation,andthefactthatc=5,000,yieldsanequilibriumpriceof$7,000.Evaluatetherelativeimportanceofeconomiesofscaleandcomparativeadvantagecausingthefollowing:MostofthealuminumissmeltedinNorwayorCanada.HalfofthelargejetaircraftareassembledinSeattle.MostsemiconductorsaremanufacturedineithertheUnitedStatesorJapan.MostScotchwhiskeycomesfromScotland.MuchofthebestwinecomesfromFrance.Therelativelyfewlocationsforproductionsuggestexternaleconomiesofscaleproduction.Iftheseoperationsarelarge,theremayalsobelargeinternaleconomiesofscaleinproduction.Sinceeconomiesofscalearesignificantinairplaneproduction,ittendstobedonebyasmallnumberof(imperfectlycompetitive)firmsatalimitednumberoflocations.suchlocationisSeattle,whereBoeingproduces.Since external economies of scale are significant in semiconductor production,semiconductorindustriestendtobeconcentratedincertaingeographiclocations.If,somehistoricalreason,asemiconductorisestablishedinaspecificlocation,theexportofsemiconductorsbythatcountryisduetoeconomiesofscaleandnotcomparativeadvantage."True"scotchwhiskeycanonlycomefromScotland.Theproductionofscotchwhiskeyrequiresatechniqueknowntoskilleddistillerswhoareconcentratedintheregion.Also,soilandclimacticconditionsarefavorableforgrainsusedinlocalscotchproduction.Thisreflectscomparativeadvantage.Francehasaparticularblendofclimacticconditionsandlandthatisdifficulttoreproduceelsewhere.Thisgeneratesacomparativeadvantageinwineproduction.TherearesomeshopsinJapanthatsellJapanesegoodsimportedbackfromtheUnitedStatesatadiscountoverthepriceschargedbyotherJapaneseshops.Howispossible?TheJapaneseproducersemploypricediscriminationacrossUnitedStatesandJapanesemarkets,sothatthegoodssoldintheUnitedStatesaremuchcheaperthanthosesoldinJapan.ItmaybeprofitableforotherJapanesetopurchasethesegoodsintheUnitedStates,incuranytariffsandtransportationcosts,andresellthegoodsinJapan.Clearly,thepricedifferentialacrossmarketsmayleadtosuchprofitablechance.ConsiderasituationsimilartothatinFigure6-9,inwhichtwocountriesthatcanproduceagoodaresubjecttoforward-fallingsupplycurves.Inthiscase,however,supposethatthetwocountrieshavethesamecosts,sothattheirsupplycurvesareidentical.Whatwouldyouexpecttobethepatternofinternationalspecializationandtrade?Whatwoulddeterminewhoproducesthegood?P,C

P,CExternalEconomicsandSpecializationP,CExternalEconomicsandSpecializationACACDACACDQ QSupposetwocountriesthatcanproduceagoodaresubjecttoforward-fallingsupplycurvesandareidenticalcountrieswithidenticalcurves.Ifonecountrystartsoutasaproducerofagood,i.e.ithasaheadstartevenasamatterofhistoricalaccident,thenallproductionwilloccurinthatparticularcountryanditwillexporttotherestoftheworld.Whatarethebenefitsofinternationaltradeinthiscase?Dotheyaccrueonlytothecountrythatgetstheindustry?Consumersinbothcountrieswillpayalowerpriceforthisgoodwhenexternaleconomiesaremaximizedthroughtradeandallproductionislocatedinasinglemarket.Inthepresentexample,nosinglecountryhasanaturalcostadvantageorisworseoffthanitwouldbeunderautarky.Itisfairlycommonforanindustrialclustertobreakupandforproductiontomovetolocationswithlowerwageswhenthetechnologyoftheindustryisnolongerrapidlyimproving—whenitisnolongeressentialtohavetheabsolutelymostmodernmachinery,whentheneedforhighlyskilledworkershasdeclined,andwhenbeingatthecuttingedgeofinnovationconveysonlyasmalladvantage.Explainthistendencyofindustrialclusterstobreakupintermsofthetheoryofexternaleconomies.Externaleconomiesareimportantforfirmsastechnologychangesrapidlyandasthe“cutting edge” moves quickly with frequent innovations. As this process manufacturingbecomesmorenormalandstandardandthereislessadvantagebroughtbyexternaleconomies.Instead,firmslookforlowcostproductionlocations.Sinceexternaleconomiesarenolongerimportant,firmsfindlittleadvantageinbeingclusteredanditislikelythatlow-wagelocationswillbechosen.chapter8Theimportdemandequation,MD,isfoundbysubtractingthehomesupplyequationfromthehomedemandequation. ThisresultsinMD=80-40xP. Withouttrade,domesticandquantitiesadjustsuchthatimportdemandiszero.Thus,thepriceintheabsenceoftradeis2.a. Foreign'sexportsupplycurve, XS, isXS=-40+40 xP. Intheabsenceoftrade,priceis1.b. Whentradeoccursexportsupplyisequaltoimportdemand, XS=MD. Thus,usingequationsfromproblems1and2a, P=1.50,andthevolumeoftradeis20.a. ThenewMDcurveis80-40x(P+t)wheretisthespecifictariffrate,equalto0.5.(Note:insolvingtheseproblemsyoushouldbecarefulaboutwhetheraspecifictarifforadvaloremtariffisimposed.Withanadvaloremtariff,theMDequationwouldbeexpressedasMD=80-40x(1+t)P).Theequationfortheexportsupplycurvebytheforeigncountryisunchanged. Solving,wefindthattheworldpriceis$1.25,andthustheinternalpriceathomeis$1.75. Thevolumeoftradehasbeenreducedto10,andthetotaldemandforwheatathomehasfallento65(fromthefreetradelevelof70).ThetotaldemandforwheatinForeignhasgoneupfrom50to55.HomeSupplyabcdeHomeSupplyabcdeHomeDemandPricePT=1.75PW=1.50PT*=1.2550 55 60 70 Quantitywheretheareasinthefigureare:a:55(1.75-1.50)-.5(55-50)(1.75-1.50)=13.125b:.5(55-50)(1.75-1.50)=0.625c:(65-55)(1.75-1.50)=2.50d:.5(70-65)(1.75-1.50)=0.625e:(65-55)(1.50-1.25)=2.50Consumersurpluschange:-(a+b+c+d)=-16.875.Producersurpluschange:a=13.125.Governmentrevenuechange:c+e=5.Efficiencylossesb+dareexceededbytermsoftradegaine.[Note:inthecalculationsforthea,b,anddareasafigureof.5showsup.Thisisbecausewearemeasuringtheareaofatriangle,whichisone-halfoftheareaoftherectangledefinedbytheproductofthehorizontalandverticalsides.]Usingthesamesolutionmethodologyasinproblem3,whenthehomecountryisverysmallrelativetotheforeigncountry,itseffectsonthetermsoftradeareexpectedtobemuchless.Thesmallcountryismuchmorelikelytobehurtbyitsimpositionofatariff.Indeed,thisintuitionisshowninthisproblem.Thefreetradeequilibriumisnowattheprice$1.09andthetradevolumeisnow$36.40.Withtheimpositionofatariffof0.5byHome,thenewworldpriceis$1.045,theinternalhomepriceis$1.545,homedemandis69.10units,homesupplyis50.90andthevolumeoftradeis18.20. WhenHomeisrelativelysmall,theeffectofatariffonworldpriceissmallerthanwhenHomeisrelativelylarge. WhenForeignandHomewerecloserinsize,atariffof.5byhomeloweredworldpriceby25percent,whereasinthiscasethesametarifflowersworldpricebyabout5percent.TheinternalHomepriceisnowclosertothefreetradepriceplustthanwhenHomewasrelativelylarge. Inthiscase,thegovernmentrevenuesfromthetariffequal9.10,theconsumersurpluslossis33.51,andtheproducersurplusgainis21.089.Thedistortionarylossesassociatedwiththetariff(areasb+d)sumto4.14andthetermsoftradegain(e)is0.819.Clearly,inthissmallcountryexamplethedistortionarylossesfromthetariffswampthetermsoftradegains. Thegenerallessonisthesmallertheeconomy,thelargerthelossesfromatariffsincethetermsoftradegainsaresmaller.Theeffectiverateofprotectiontakesintoconsiderationthecostsofimportedintermediategoods.Inthisexample,halfofthecostofanaircraftrepresentscomponentspurchasedfromothercountries. Withoutthesubsidytheaircraftwouldcost$60million. TheEuropeanvaluetotheaircraftis$30million.Thesubsidycuts thecostofthevalueaddedtopurchasersoftheairplaneto$20million. Thus,theeffectiverateofprotectionis(30-20)/20=50%.Wefirstusetheforeignexportsupplyanddomesticimportdemandcurvestodeterminethenewworldprice.Theforeignsupplyofexportscurve,withaforeignsubsidyof50percentperunit,