Neoclassical Theory 新古典理論
Problems with Classical Theory古典理論的一些不足
1.Labor theory of value is unrealistic. 價值勞動說太不符實了
2.The assumption of constant opportunity cost is too restrictive. 單位成本不變太限制了，也造成生產可能曲線是直線。
3.Demand side is largely ignored. 需求面大大被忽視。
Assumptions for Neoclassical Trade Theory 新古典理論的假設
1.Consumers seek to maximize satisfaction.
消費者追求效用最大
2.Firms seek to maximize the return from productive activities.
廠商追求利潤最大
3.Factors are mobile within country but immobile between countries.
要素在國內自由移動，在國際間則否
4.No transportation cost, no trade barrier.
沒有交通成本與貿易障礙
5.perfect competition.
完全競爭市場
Autarky Equilibrium 自給自足均衡
In the absence of trade, production takes place on PPF, and the particular point on the PPF is chosen by the relative price of goods and relative inputs. The slope of PPF is MRT (Marginal rate of Transformation), which is the ratio of MC of two industries.
沒有貿易的情況下，生產組合如生產可能曲線，而生產的均衡會在於產品價格線與生產可能線的交點如圖。生產可能線的斜率是其相對邊際成本，而價格線斜率是其相對價格。當X的價格高於X的邊際成本時，會傾向多生產X直到邊際成本與價格一樣時。
To find out the autarky equilibrium, we also consider the demand side and add the indifference curve to the figure. The autarky equilibrium will happen when MRT = Relative price = MRS
透過供需找到平衡點
International Trade 新古典理論-國際貿易
The international trade will lead the country to a new set of relative price. The ultimate source of gain from trade is the difference in relative prices in autarky between countries.國際貿易會使國家得到一個新的國際市場價格，貿易的利益就來自於相對價格的不同。
The international price is (PX/PY)2 which makes the ratio steeper than the price in autarky. Px>Py states that home country has comparative advantage on good X.
當國際價格如圖所示，Px較高於Py代表此國在生產X有比較利益，也可以說其生產X較有效率。所以最終結果會是出口X，進口Y。
Gain from Trade – Consumption Gain and Production Gain 貿易中的獲益
Consumption Gain (Gain from Exchange): even if producers don’t change production levels, welfare is enhanced. 即便不改變生產組合，消費者依然可以從貿易中獲益。
Production Gain (Gain from Specialization): specialization in the comparative advantage product leads to higher welfare.專業化本身就已經帶來的獲益。
Minimum Condition for Trade 貿易的最低條件
As we learned before, the different price ratio is the source to cause the gain from trade. But how do we make sure that there’s different price ratio(APRs) ?
The different APRs may be the result of different “demand” or the result of different “supply” or both.
Important Assumptions in the Analysis
- Costless factor mobile.
- Full employment of factors of production
- The indifference curve map can show welfare change.