International Economics,
Sixth Edition

International Economics,
Sixth Edition

International Economics,
Sixth Edition

The patterns of international trade and investment cited in Chapter 1 sometimes vary
considerably from year to year, but they also demonstrate general trends over time. Factors
that determine the volatility in the short run often differ from factors that determine the
long-run trends. In the first half of this book, we pay primary attention to the longer-run
determinants of these trends in international trade and investment. Economists often refer
to these relationships as pertaining to the “real side of the economy.” The goods a country
trades typically are independent of whether the country fixes the value of its national
currency in terms of gold, or euros, or the dollar. Likewise, a country’s choice of monetary
policy is not likely to have a permanent impact on whether it exports airplanes and imports
shoes. Although such financial relationships are a significant part of our discussion of
international finance in the second half of this book, we largely ignore them in our treatment
of trade theory and trade policy.

Robert M. Dunn, Jr.
John H. Mutti