Part IV: Final Thoughts on Competitive Trade Models

Part IV consists of Chapters 18 and 19. Each of them appeared in publications in 2015. Chapter 18 focuses on a number of features of small-scale general equilibrium models that are used in international trade theory. Not surprisingly, the first such model is the Ricardian model, discussed in Part 1 of this book. As well there are subjects not treated earlier in the book, such as the stability issues in models, the transfer problem and the Reciprocity Theorem. As the title of the chapter suggests, models that specifically are limited to dealing with small numbers of commodities, factors, and countries often reveal properties that can be found in models that are not so limited but are, therefore, more difficult to analyze…