|This course will study international economics from the perspective of the firm. The objective is to become familiar with organizational, financial and legal issues that firms face in foreign markets. To this end, we will analyze conceptual frameworks that guide firms’ decision to expand globally through exporting, investing or forming alliances. We will address questions such as: how do firms decide to export and where to export? What is the rationale behind the common organizational forms (joint ventures with local partners vs. wholly owned foreign subsidiaries) we see in foreign operations? What factors determine the location choice for investing abroad?
We will also investigate in depth some of the key issues multinational firms face: intellectual property rights in foreign markets, financial and operational hedging techniques to manage exchange rate risk, international tax planning, political risk and corruption in international business. Part of the course will be devoted to the analysis of the business environment and management practices in developing countries.
|There is no CoursePack. Slides and other readings will be available for downloading from the Chalk.|
|Based on assignments, participation, an in-class midterm, and final exam. Students may opt for a term paper instead of taking the exams.
Students who require a provisional grade must take the mid-term exam and perform at a level of at least C-. The course may be taken pass/fail.
Description and/or course criteria last updated: 11/19/2012
|The course has no strict requirement but I assume familiarity with basic concepts taught in Microeconomics (Bus 33001).|
|Sample Exam Questions/Problem Sets:|
|Midterm exam question: We frequently hear stories in the news media about how small businesses in the U.S. started to rely less on Chinese suppliers and increasingly prefer to buy from domestic manufacturers (the article Made in America from the Wired magazine is an example of such reporting). What factors are behind this trend?
Final exam question: How can we explain the fact that patent reforms in developing countries lead to increased inward FDI only in industries with long product lifecycles? (Note: product lifecycle is the time during which a product remains marketable after its introduction. Products for which new models are very frequently released have short life-cycles.)
Description and/or course criteria last updated: 07/2012
|Course Conditions and Course Related Items:|