Consider the standard trade model with two goods and two factors, labour and capital (d) Explain the difference between export-biased growth and import-biased growth, commenting on their economic impact. (e) Discuss two reasons why international trade has strong effects on the distribution of income. (f) Explain why economists often consider the effects of free trade on income distribution to be less important than the effects on overall welfare. Discuss an example where the distributional effect has had more lasting importance.

Consider the standard trade model with two goods and two factors, labour and capital (d) Explain the difference between export-biased growth and import-biased growth, commenting on their economic impact. (e) Discuss two reasons why international trade has strong effects on the distribution of income. (f) Explain why economists often consider the effects of free trade on income distribution to be less important than the effects on overall welfare. Discuss an example where the distributional effect has had more lasting importance.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter17: Income, Poverty, And Health Care

Section: Chapter Questions

Problem 8P

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