- Mercantilism is a bankrupt theory that has no place in the modern world. Discuss.
- One Country Focus in this chapter reviews the arguments of those who suggest that Japan is a neomercantilist nation. Do you agree with this assessment? Can you think of cases in which your country has taken a neomercantilist stance to foreign competition?
- Using the theory of comparative advantage to support your arguments, outline the case for free trade.
- Using the new trade theory and Porter's theory of national competitive advantage, outline the case for government policies that would build national competitive advantage in a particular industry. What kind of policies would you recommend that the government adopt? Are these policies at variance with the basic free trade philosophy?
- You are the CEO of a textile firm that designs and manufactures mass-market clothing products in the United States. Your manufacturing process is labor-intensive and does not require highly skilled employees. You have design facilities in Paris and New York and manufacturing facilities in North Carolina. Drawing on the theory of international trade, decide whether these are optimal locations for these activities.
- In general, policies designed to limit competition from low-cost foreign competitors do not help a country achieve greater economic growth. Discuss this statement.
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