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In Table 5-2, we show the growth in the real rental and real wages in Singapore, along with the implied productivity growth. One way to calculate the productivity growth is to take the average of the growth in the real

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In Figure 4-3, we show how the movement from the no-trade equilibrium point
A to a trade equilibrium at a higher relative price of computers leads to an upward sloping export supply, from points A to D in panel

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Suppose that there are drastic technological improvements in shoe production at Home such that shoe factories can operate almost completely with computer-aided machines. Consider the following data for the Home country:
Computers: Sales revenue = PCQC = 100

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Use the following information to answer the questions below:
Manufacturing: Sales revenue = PM • QM = 150
Payments to labor = W • LM = 100
Payments to capital = RK • K = 50

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Starting from equilibrium in the specific-factors model, suppose the price of manufactured goods falls so that wages fall from W´ to W in Figure 3-5.
a. Show that the percentage fall in the wage is less than the percentage

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In the text, we learned that workers displaced by import competition are eligible for compensation through the Trade Adjustment Assistance program. Firms are also eligible for support through Trade Adjustment Assistance for Firms, a federal program that provides financial assistance

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Similar to Home in Problem 10, Foreign also produces computers and wheat using capital, which is specific to computers; land, which is specific to wheat; and labor, which is mobile between the two sectors. Foreign has 100 workers and 100

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Home produces two goods, computers and wheat, for which capital is specific to computers, land is specific to wheat, and labor is mobile between the two industries.
Home has 100 workers and 100 units of capital but only 10

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Now suppose the world relative price of cars is PC/PTV = 1.
a. In what good will each country specialize? Briefly explain why.
b. Graph the new world price line for each country in the figures in Problem

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Suppose that the Home country is much larger than the Foreign country. For example, suppose we double the number of workers at Home from 25 to 50. Then Home is willing to export up to 100 bushels of wheat at