Category: International Economics

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Exam Questions International Economics Northwestern Problem Sets Syllabus

Northwestern. Reading List and Exams for International Trade and Finance. Harwitz, 1962

1950 senior picture from high-school

The following course materials were found in Robert Clower’s papers at Duke University’s Economists’ Papers Archive. Clower collaborated with Mitchell Harwitz (MIT Ph.D., 1959) on a few papers and kept some of Harwitz’s course materials from their years together at Northwestern.

The course offers us some insight into International Economics à la Charles Kindleberger as taught by one of his former M.I.T. doctoral students.

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AEA Members Listing 1991

HARWITZ, MITCHELL, SUNY Buffalo, Dept. Econ, Buffalo, NY 14260.
Birth Yr: 1934.
Degrees: B.A., Brandeis U. 1954; Ph.D. M.I.T., 1959
Prin. Cur. Position: Assoc. Prof., SUNY at Buffalo, 1964
Concurrent/Past Positions: Asst. Prof., Northwestern U., 1958-64
Research: Temporal-spatial choice theory, labor coops with complex contracts.

Source: AEA Biographical Listing, 1993, p. 205

____________________________

Economics Ph.D., M.I.T. 1959

Dissertation: On Some Problems in the Dynamic Theories of International Trade and Economic Growth

Advisor: Charles Poor Kindleberger

Source: Mathematics Genealogy Project.

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LECTURE AND READING LIST

NORTHWESTERN UNIVERSITY
DEPARTMENT OF ECONOMICS

Economics B-60
International Trade and Finance

Winter, 1962
Mr. Harwitz

There are a total of 36 class hours, of which two are devoted to mid-term examinations and three remain for reviews. The mid-term grades will constitute about 40% of the final grade.

The text is C. P. Kindleberger, International Economics, hereafter called K.

There will be a homework exercise on balance of payments accounting handed out after the January 11 lecture.

Date of Lecture

 Topic

Reading

1/8

 Introduction and review K, Ch. 1
Optional: Samuelson, Economics, Ch. 31, Ch. 32 and Appendix
I. Balance of Payments and FX Markets

1/9,10

 A. Balance of Payments
1. Relation of B of P to National Income Accounts K, Ch. 2
2. Relation of items of B of P to FX markets
B. FX Markets K, Ch. 3

1/11

 1. Equilibrium in FX markets K, Ch. 24

1/15-17

 2. Dynamics of FX market adjustment K, Ch. 4
a. Fixed exchange rates
b. Fluctuating exchange rates
c. Exchange control
II. Current Account: Trade Theory

1/18,22

 A. Supply K, Ch. 5. – handout

1/23-4

 B. Demand K, Ch. 6

1/25

 C. Trends in Supply and Demand K, Ch. 7

1/29-30

 D. Comparative Statics of FX equilibria K, Ch. 9

1/31-2/1

 E. Comparative statics of income equilibria K, Ch. 10

2/5

 [FIRST] EXAMINATION
III. Current Account: Commercial Policy

2/6,7

 A. Tariffs K. 12

2/8

 B. Selected alternative devices Handout
IV. Capital Account

2/12

 A. Short-term capital movements K, Ch. 17

2/13-14

 B. Private and public lending K, Ch. 19

2/15,19

 C. Direct investment K, Ch. 20

2/20

 D. Capital accounts in the course of development K, Ch. 21
V. Transfers and government assistance

2/21-2

 K, Ch. 23

2/25

 [SECOND] EXAMINATION
VI. Disequilibria and adjustment mechanisms

2/27

 A. Reprise on equilibrium K, Ch. 24

2/28, 3/1,5

 B. Types of disequilibria and related adjustment K, Ch. 28

3/12

 FINAL EXAMINATION, 8-10 A.M.

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Exercise in Balance of Payments Accounting

Economics B-60
DUE: JANUARY 18

Winter, 1962
January 11, 1962

From the information that follows, construct a balance of payments statement for the U.S. for the month of January, 1962, during all these transactions take place. Write out the statement showing both debits and credits, as well as the net figures, classified in the format used in Table 2.2 of the text. In addition, provide a memorandum note justifying each of your entries.

Transactions

  1. An American clothing manufacturer buys $5000 worth of English tweed for suiting, paying with a ninety-day draft on the sterling account of his own American commercial bank.
  2. An American automobile dealer buys $10,000 worth of English Ford carss from a distributor in New York, paying to the distributor’s bank in New York.
  3. An individual American buys a Rolls-Royce for delivery in England, paying in advance with a check in dollars to the English dealer, in the amount of $6,000.
  4. An American electric power producer contracts to purchase an electric generator costing $100,000 from an English engineering firm, with delivery to be made in June. A down payment of $100,000 is made in dollars to the New York account of the British firm.
  5. An English appliance dealer buys American refrigerators worth $25,000, paying with dollars purchased fron its English bank.
  6. An English film distributer rents a Hollywood film for £10,000, paying the sterling into the English account of the Holywood producer.
  7. An American sugar broker sells a ninety day future on Cuban sugar to a British importer for $15,000, taking payment in dollars from the New York account of the importer.
  8. An English steel making consortium pays its current share, $100,000, into a dollar account to help defray the expenses of a new mining venture. $50,000 is provided out of the group’s own dollar holdings, and the rest is purchased from the dollar holdings of British banks.
  9. An American investor buys 90-day British treasury bills on the London market with £5,000 bought in New York banks and £10,000 bought from London banks.
  10. The British Exchequer makes a special repayment of lend-lease debt of $100,000 by turning over earmarked gold in New York.
  11. An American bank decreases its hedged working balances in London by $50,000.
  12. An Englishman receives, in England, interest coupons worth $1,000, showing accumulated interest on part of his holding of U.S, railroad bonds. He discounts them with his bank.

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NOTES ON THE
BALANCE OF PAYMENTS PROBLEM

Economics B-60

January 24, 1962
Mr. Harwitz

Apparently standard errors

  1. Impors and exports are recorded as they clear ports. Thus, the Rolls-Royce represents an increase in assets owned abroad by Americans, not an import. A similar remark holds for the signing of the generator contract. Such timing errors should not throw the Balance of Payments out of balance, but they should affect the accuracy of your division between the current and the capital accounts.
  2. There was a very clear correlation between working out a careful debit and credit account for each transaction and getting a consistent set of accounts. The resulting accounts might, of course, differ from mine on grounds of interpretation or timing. But they would balance.
  3. Misuse of “errors and omissions” account. This account is non-zero only because reporting in the real world does not cover both ends of every transaction. Since both ends of every transaction were given to you, it should have been clear that no balancing account was necessary.

The Balance of Payments Exercise

I shall indicate how each of the transactions should be handled, and then draw up the resulting accounts. There are no errors and omissions, so there will be no such entry in the accounts. (-) means debit and (+) means credit.

  1. The purchase of tweed is an import, and therefore a debit, and the matching credit is an increase in U.S. obligations abroad, a capital inflow. The inflow would be cancelled, and replaced by a credit arising from a decrease in U.S. assets abroad, when the draft is actually cashed at the importer’s bank.

Import: – $5000
Increase in s/t liabilities to abroad: + $5000

  1. There are two alternative ways to treat this transaction. The first is to assume that the distributor is an American firm, in which case the transaction is purely internal to the U.S. if the cars have already been brought into New York by the distributor. The second is to assume that the distributor is British, and that the American buyer is taking delivery in New York, or, equivalently, that the American buyer is placing an order that actually required an import by the distributor doing business in New York. In my own accounts, I shall use the first (lazy man’s) interpretation, but the second, if used, would lead to:

Import:  -$10,000
Increase in s/t liabilities to abroad: + $10,000

  1. Since the Rolls has not crossed the border of the U.S., the appropriate debit entry is an increase in U.S. assets abroad. The matching credit entry is an increase in s/t liabilities to abroad (the increase in British holdings of U.S. dollars).

Increase in s/t assets abroad: – $6000
Increase in s/t liabilities to abroad: + $6,000

  1. There was an error in my original typescript, and the total cost of the machinery should have read $1,000,000, not $100,000 as it did. I don’t think this affects the balance of payments very seriously, however. I would be inclined to treat this transaction as made up of an increase in a l/t assets abroad (consisting of the paid-up portion of the contract) and a matching credit arising from an increase in British holdings of U.S. dollars. Thus

Increase in l/t assete abroad: – $100,000
Increase in s/t liabilities to abroad: + $100,000

One could argue, however, that with the correct cost figure the entry should be an increase in l/t assets abroad of $1,000,000, with a matching credit entry of $1,000,000, arising 10% from an increase in British holdings of dollars and 90% from the contractual promise to pay the remaining $900,000.

  1. This transaction is perfectly simple. The export is a credit, and the matching debit is a decrease in s/t liabilities to abroad, which arises from the “repatriation” of U.S. dollars.

Export: +25,000
Decrease in s/t liabilities to abroad: -$25,000

  1. The export of sevices is a credit, and the matching debit is an increase in U.S. assets abroad (in this case an increase in American ownership of English pounds), that is, a capital outflow.

Export of services: +$28,000
Increase in s/t assets abroad: – $28,000

Here, as elsewhere in the exercise, I convert figures in pounds sterling into dollars at the official rate of $2.80/£.

  1. Here, a short-tern foreign asset of the U.S. (a claim for future delivery of non-U.S. sugar) is sold, giving rise to a credit. The matching debit is the decrease in foreign-owned U.S. government liabilities.

Decrease in s/t U.S. assets abroad: + $15,000
Decrease in s/t liabilities to abroad:  – $15,000

  1. There are two alternatives here. The first is to assume that the dollar account of the consortium or joint venture is held in the U.S. In this case, the debit entry is a decrease in dollar holdings abroad ($50,000 held by banks, $50,000 held in private banking accounts by members of the consortium), matching a $100,000 increase in U.S. liabilities to abroad. The liabilities are short-term if the joint venture is a U.S. corporation giving shares for the $100,000 payment. I take this alternative, with the second interpretation. The second alternative is to assume that the dollar account is actually held in London. The transaction then washes out of the U.S. Balance of Payments, being only a transfer of continuing U.S. obligations between foreign owners. On my interpretation, the transaction is recorded thus:

Increase in l/t liabilities to abroad: + $100,000
Decrease in s/t liabilities to abroad: – $100,000

  1. The increase ih assets abroad (a capital inflow) is a debit, valued at $42,000 at the official exchange rate. The matching credits are the decrease in U.S. holdings of pounds sterling ($14,000) and an increase in U.S. obligations to abroad ($28,000 in dollars acquried by British banks).

Increase in s/t assets abroad: – $42,000
Decrease in s/t assets abroad: + $14,000
Increase in s/t Iiabilities to abroad: +28,000

  1. The debit entry is clear: an inflow of monetary gold to the U.S. The matching credit entry is perhaps a little artificial, but the standard procedure would, I think, be a decrease in foreign l/t liabilities (Lend-Lease debts) to the U.S.

Decrease in l/t assets abroad: + $100,000
Import of Monetary Gold: – $100,000

  1. This transaction washes out, since it involves a spot sale of pounds worth $50,000, a sale that would be used to fulfill the futures contract for delivery of pounds. That is the meaning of a “decrease in hedged balances”. I chose not to record it, but if it were recorded it would give rise to a credit from the acquisition of dollars and a debit from the fulfillment of the futures contract.
  2. The interest payment is itself a debit, and enters the current account. The matching credit is the increase in dollar obligations owned abroad (in this instance by the British bank).

Interest payment_ – $1,000
Increase in s/t liabilities to abroad: +$1,000

*  *  *  *  *  *  *  *  *  *  *  *  *

THE U.S. BALANCE OF PAYMENTS (Cf. K, Table 2.2)

Transaction Number
A. Goods and services + $47,000
1,2. Merchandise exports + $53,000 5,6
Merchandise imports –  $ 5,000 1
6. Investment income: debits –  $ 1,000 12
C. Capital and Monetary Gold – $47,000
11,15. Long-term liabilities + $100,000
(Other + $100,000) 8
12, 16. Short-term liabilities -0- 1,3,4,5,7,8,9,12
13, 17. Long-term assets -0-
(U.S. Govt loans repaid + $100,000) 10
(Other Private and banks – $100,000) 4
14, 18. Short-term assets – $47,000
(Private and banks) – $47,000) 3,6,7,9
19. Monetary Gold – $100,000 10
Net errors and omissions -0-

Notes to the Balance of Payments Table

The lines in parenthesis are subtotals, and should not be counted in checking to see that the addition and subtraction are correct. A simple check on the accuracy of the presentation (one that will not work all the time) is to note that each transaction number appears exactly twice. In general, the transaction numbers would appear at least twice, and in any case never only once.

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FIRST HOUR EXAMINATION

NORTHWESTERN UNIVERSITY
DEPARTMENT OF ECONOMICS

Economics B-60
International Trade

February 7, 1962
Mr. Harwitz

Directions, notes, and hints. Please write on every other page of your blue books, to make marking the examinations easier for me. The total time allowed is 50 minutes, and the set of True-False questions should take twelve minutes. The point count of the questions is the suggested number of minutes. Answer all the true-false questions and two of the remaining four; that is, answer five questions in all. If you answer more than two of the last four questions, I shall choose two of the answers arbitrarily and mark you on them.

If I ask you to comment In detail, I mean that you should set out an explicit theoretical model on which to base your answer. The point of the question, obviously, is to test whether you can handle the theory. In answering the true-false questions, your explanation can be kept to a couple of sentences at most. Be very careful in reading these questions!

  1. True-False. Mark true or false, and explain your choice briefly. (12 minutes)
    1. Multiple exchange rates are prevented by arbitrage because arbitrageurs take long positions in foreign currencies.
    2. Interest arbitrage between two countries (say, the U.S. and Great Britain) serves to keep short-term interest rates in New York and London from diverging.
    3. The very large size of the hedged balances of foreign exchange held by banks as working balances introduces a possible element of instability in the foreign exchange market.
  2. Answer two of the following four questions. They all weigh equally.
    1. “One trouble with the theory of international trade is that it puts too much emphasis on one blade of the Marshallian scissors — the supply side — by trying to determine the direction of trade solely in terms of comparative costs.” Comment in detail.
    2. “The idea that trade will take place between two countries because trading will benefit the countries as a whole is clearly wrong, since trade really takes place between individual firms, regardless of whether or not the countries of which the firns are residents benefit from the individual trading.” Comment in detail, using the concept of the production-possibility locus.
    3. An underdevloped country that trades on an international gold standard undertakes a development project (say, a road-building program) with the aid of an IBRD loan covering the direct foreign exchange requirements of the program. Show what is likely to happen to the balance of trade on current account and to the gold reserves of the country. (Certain assumptions have to be made. Make then explicitly!)
    4. The Phillipines have just gone on a freely-fluctuating exchange rate. Suppose a direct competitor in sales of tropical food crops to the United States (say, Panama) produces a bumper crop, which the competitor cannot store and must try to sell immediately. What happens to the balance of trade and the foreign exchange rates of the Phillipines? (Hints: you can make things easier for you and for me if you restrict your attention to the Phillipines and the United States. Again, certain assumptions need to be made explicitly.

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SECOND HOUR EXAMINATION

NORTHWESTERN UNIVERSITY
DEPARTMENT OF ECONOMICS

Economics B-60
International Trade

February 28, 1962
Mr. Harwitz

Directions. Please write on every other page of the blue books.

  1. Short answer questions. Answer 6 of the following 8 questions. Each question is worth four points.
    1. Show that an import of goods on current account, taken by itself, will in fact reduce the domestic money supply of the importing country. (HINT: examine the effect of payment for the transaction on the balance sheet of the domestic banking system.)
    2. Show that an increase in the forward exchange rate between dollars and pounds, with the short-term interest rates in the U.S. and Great Britain fixed, will cause a rise in the current spot rate.
    3. “The fact that Nigeria had a large export surplus vis-a-vis Great Britain during World War II, and that the sterling proceeds of the surplus were blocked in British banks, meant that Nigeria did less domestic investing during that period than she might otherwise have done.” True or false, and why?
    4. Why would a “successful” protective tariff be a poor revenue tariff? (Please draw a picture illustrating the point.)
    5. Under what circumstances may one country in a 2-country world increase its share of the gains from trade by the imposition of an import tariff?
    6. Back in the dear dead days of the “dollar shortage” (the late 1940’s), it was suggested that Europe was justified in imposing tariffs or quotas against American goods because the United States had an advantage in every line of production as a result of the War. What’s wrong with the suggestion?
    7. Define a “beggar-thy-neighbor” tariff policy, and show the effects of such a policy on the country imposing the tariff.
    8. “The protective effect of a tariff is independent of the elasticity of domestic demand in the country imposing the tariff.” True or false, and why?
  1. Medium-long answers. Answer 2 of the following 3 questions. Each question is worth 13 points.
    1. It is not unreasonable to argue that any effect achievable by means of a tariff could equally well be achieved by means of a subsidy for import-competing industries. (a) Is this always true? (b) What in fact is the basis of the argument if and when it is true?
    2. Suppose that in 1946 the U.S. decided to lend Great Britain $50,000,000 to help the British recover from the destruction of its capital stock consequent upon World War II. What criteria should be applied for deciding whether the loan should be in the form of capital goods or in the form of dollars that could be used to finance imports of either capital goods or consumer goods? (Assume in this case a 2-country world.) What application does this kind of argument have in evaluating the usefulness of our present policy of embargoing trade in strategic materials with the Communist bloc, while allowing free trade in “non-strategic materials”?
    3. Compare the advantages and disadvantages of direct investment versus long-term lending from the point of view of the receiving country.

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FINAL EXAMINATION

NORTHWESTERN UNIVERSITY
DEPARTMENT OF ECONOMICS

Economics B-60
International Trade

March 12, 1962
Mr. Harwitz

Instructions. Please write on every other page of your blue books, as usual. The point count on the questions is equal to the suggested time you should take to answer them, As before, I shall choose the appropriate number of answers and grade you on them in sections where you answer more questions than I ask you to.

I. Definitions. Answer 10 of the following 15. (3 minutes each)
Note an example or draw a picture if it seems helpful.

    1. Foreign trade multipliers.
    2. Elasticity optimism and pessimism.
    3. Hedging function of the foreign exchange market.
    4. Exchange control system.
    5. Errors and omissiors in the balance of payments accounts.
    6. Bill of exchange.
    7. Gold sterilization.
    8. Protective effect of a tariff.
    9. Revenue effect of tariff.
    10. Redistibutive effect of a tariff.
    11. Balance of trade.
    12. Multilateral exchange clearing.
    13. Interest arbitrage.
    14. Multiple cross rates.
    15. Purchasing power parity.

II. Answer one of the following two. (10 minutes.)

    1. (a) Show that the excess demand for foreign currency is exactly equal to the excess of imports over exports when there are no autonomous movements in capital or gold.
      (b) Define the excess demand for foreign currency when there may be autonomous movements on capital account. What is the effect on the domestic money supply of positive excess demand for foreign currency?
    2. In current terminology, the United States Balance of Payments is said to be in deficit condition if there are compensating outflows of gold or inflows of capital. Show that this can happen even if the balance of trade is in surplus condition on the usual definition. Relate this to the U.S. experience in the last decade.

III. Answer one of the following two. (15 minutes)

    1. F. P. Graham has argued that reciprocal demand has no influence on the relative prices of internationally traded commodities. In the context of a 2-country, 2-good, constant-opportunity-cost model, he is right in the special circumstance that one country is exceedingly large relative to the other. Show why, and show why this may be considered a rather special case.
    2. One can characterize naive comparative cost doctrine as saying that factor endowments determine the goods that a country will import and those it will export. Sophisticated doctrine, like mine, says that a country will export goods the prices of which are relatively lower before trade (in isolation) in the potential exporting country than they are in the potential importer.

IV. Answer one of the following two. (15 minutes)

    1. It has been argued that an examination of the historical evidence indicates that the 19th century adjustment mechanism under the gold standard was not the classical price-specie-flow mechanism. Indicate another mechanism under which the draining-off of gold in a deficit country and the build-up of gold reserves in a surplus country would give rise to an equilibrating counter-flow of capital items[?] in the balance of payments and/or a shift in the determinants of the balance of trade in the equilibrating direction.
    2. (a) Define the term “gold points” (or the equivalent “gold-import and gold-export points”).
      (b) What is the effect on the U.S. gold points if the Treasury imposes a charge for the conversion of goid into currency and vice-versa?
      (c) Keynes proposed, in the Treatise on Money (Vol. II, Ch. 34, Sec. iii), that it would be useful for a country that wished to isolate its domestic money market as much as possible from the repercussions of international situations to introduce a wide spread between the gold points. Precisely what do you think he meant, and in what way do you think the proposal would accomplish its purpose? What combination of adjustment mechanisms did he apparently have in mind?

V. Answer one of the following two, (15 minutes)

    1. Quote from Mr. Louis d’Or, president of the Mercantile Bank of Upper Lower: “The United States would be much healthier economically if, like Germany, she competed hard in international markets, kept inflation down, and built up a healthy surplus in the balance of trade. Right now, the country is in bad shape as an international competitor because of the spend-thrift policies of the current” Is Louis right about Germany being healthy or about the desirability of the U.S. getting like Germany (economically, that is)? Comment in detail on the logic, the definitions, the facts.
    2. Quote from T. Tock, president of the Worthless Watch Company, Waltham, Massachusetts: “I don’t approve of this Unamerican (spelling?) scheme of direct subsidies to business. All we watchmakers want and need is a chance to compete on even terms with the cheap foreign labor. A small, scientific tariff will do for us. That’s the best way.” Is it? Yes or no, why, and from who’s point of view?

VI. Answer one of the following two.
(15 minutes)

    1. A not entirely accurate description of the English international trade position of the early 1920’s would suggest that she had structural unemployment in one of her most important export industries, shipbuilding. At that time, Mr. Churchill re-established the gold standard at the pre-war par, which was in effect an appreciation of the pound relative to other currencies. Evaluate the decision in terms of the remedies appropriate to structural disequilibrium in the export industries. Justify the remedies you say are appropriate, of course.
    2. Consider a case in which there are 2 goods, 2 factors, and 2 countries. One of the countries is relatively well endowed with capital, the other relatively well endowed with labor. Furthermore, the capital-rich country is running a continuing trade surplus with the other country, which is underdeveloped (of course), and is lending to the underdeveloped country on a regular basis. Classical theory then leads to the conclusion that, eventually, trade between the two countries must cease, as the endowment of capital in the underdeveloped country is sufficiently increased. Comment in detail.

Source: Duke University. David M. Rubenstein Rare Book & Manuscript Library. Economists’ Papers Archive. Robert W. Clower Papers, Box 4, Folder “B-60. International Trade Exams, 1962.”

Image Source: Pierre S. DuPont High School senior portrait of Mitchell Harwitz in the yearbook Pierrian 1950.

Categories
Curriculum Economics Programs International Economics LSE Money and Banking Suggested Reading Syllabus

LSE. Courses in Banking and Currency. Descriptions and Readings. Gregory and Tappan, 1924-25

From time to time during my wanderings through internet archives I stumble upon material that is ideal content for Economics in the Rear-view Mirror and that is worth the effort of digitization. Some old published Calendars of the London School of  Economics and Political Science can be accessed online and they provide much in the way of thick course descriptions and suggested readings.

This post is limited to the course offerings under the heading “Banking and Currency” that covers both domestic and international aspects of banking and money markets. In the academic year 1924-25 this field was covered by then Reader in Commerce, T. E. Gregory, and Assistant in Economics, Marjorie Tappan.

Almost all the readings listed for the courses have been successfully linked to on-line copies.

Other fields will be added in the near future, so do check back with Economics in the Rear-view Mirror!

___________________________

London School of Economics
and Political Science
Calendar for Thirtieth Session 1924-25

*  *  *  *  *  *  *  *  *  *  *

Who, what, and when

The Banking and Currency Instructors:

T. E. Gregory, D.Sc. (Econ.) London; Sir Ernest Cassel Reader in Commerce in the University of London.

Marjorie Tappan, B.A. Assistant in Economics.

The Degrees:

Bachelor of Science in Economics (B.Sc.Econ.)
Bachelor of Commerce (B.Com.)
Bachelor of Laws (LL.B.)
Bachelor of Arts (B.A.)
Higher Degrees, such as M.A., Ph.D., M.Sc. (Econ.), LL. M., LL.D., D.Sc. (Econ.), or D. Lit.

The Terms:

Michaelmas term (October 6 to December 12, 1924), Lent term (January 12 to March 20, 1925) and Summer term (April 27 to June 26, 1925) Terms
M.T., L.T. and S.T., respectively

___________________________

BANKING AND CURRENCY.

       The letter Y indicates that the course is a preparation for an Intermediate Examination, Z for a Final Pass Examination, and A for a Final Honours Examination. 

       The sign ¶ indicates a course beginning at 5.30 p.m. or later.

10. — Y. —Elements of Currency, Banking and International Exchange, a course of fourteen lectures by Miss Tappan, on Tuesdays, at 11 a.m., in the Lent and Summer Terms, beginning L.T. 17th February, S.T. 28th April.

[For B.Sc. (Econ.) Intermediate, B.Com. Intermediate (S.T. only) and B.A. Final Honours in Geography.]

Fee: —£1 15s.

¶ For evening students the same course of lectures will be given on Mondays, at 6 p.m., beginning 16th February.

Fee: — £1 3s. 4d.

Syllabus.

       PART I. — The principles governing the existence and distribution of international trade. Statistical problems in the measurement of international trade. The organization and operation of international markets. The balancing of international indebtedness. The Foreign Exchanges.

       PART II. — The functions of currency and the service of (a) money and (b) credit in their performance. The standard in a currency system and its relation to commodity prices. The elements of (1) The British Monetary System; (2) The British Banking System (a) pre-war; (b) at the present time. The influence of the Bank of England in the money and investment markets.

       BOOKS RECOMMENDED — PART I. — Marshall, Money, Credit and Commerce, Book III.; F. W. Taussig, Principles of Economics, Vol. I., Book IV.; Bastable, Theory of International Trade; Pigou, Protective and Preferential Import Duties; Higginson, Tariffs at Work; Hobson, C. K., The Export of Capital; Gregory, Foreign Exchange — before, during and after the War; Clare, A.B.C. of the Foreign Exchanges. The Official Statistics of British Trade.

                  PART II. — F. W. Taussig, Principles of Economics, Vol. I., Book III., Book IV., Ch. 32, 33; Hawtrey, Currency and Credit and Monetary Reconstruction, Chaps. I.-IV. and VI.; Kirkaldy, British Finance, 1914-1921; Cannan, Money and Economica, Jan., 1921, and Economic Journal, Dec., 1921; Robertson, Money; Layton, Introduction to the Study of Prices; Bagehot, Lombard Street, 1920 edition; Clare, A Money Market Primer; Duguid, The Stock Exchange.

*  *  *  *  *  *  *  *  *  *  *

11. — Z and A. — Principles of Currency and Banking, a course of twenty lectures by Miss Tappan, on Wednesdays, at 12 noon, in Michaelmas and Lent Terms, beginning M.T. 8th October, L.T. 14th January.

[For B.Sc. (Econ.) Final and B.Com. Final Part I.]

Fee:— For the Course, £2 10s.; Terminal, £1 10s.

For evening students the same course will be given on Tuesdays, at 7 p.m., beginning 7th October.

Fee:— For the Course, £1 13s. 4d.; Terminal, £1.

Syllabus.

       M.T. Metallic Currency. — The nature of money: recent discussions of the nature and adequate definition of money. The classification of monetary systems. The value of money: recent discussions of the problem. The return to sound money: deflation and devaluation. The social effects of rising and falling prices. Periodicity and anticipation in relation to monetary value.

       L.T. Banking and the Money Market. — The functions and economic significance of banking. The general structure and methods of banking. The cheque system and the nature of deposits. Banking in relation to the price level. The functions of Central Banks. The regulation of Note-issues, and the Bank Acts. Comparison with foreign systems. Recent developments in banking.

       BOOKS RECOMMENDED: — Cannan, Money in Relation to Rising and Falling Prices; Cannan, Bank Deposits (Economica No. 1.) and The Application of the Apparatus of Supply and Demand to Units of Currency (Ec. Journal, Dec. 1921); Hawtrey, Currency and Credit and Monetary Reconstruction; J. Bonar, Knapp’s Theory of Money (Ec. Journal, March, 1922); Cassel, Money and Foreign Exchange since 1914; Irving Fisher, The Purchasing Power of Money; L. von Mises, Theorie des Geldes und der Umlaufsmittel; Laughlin, The Principles of Money; Layton, Introduction to the Study of Prices; Foxwell, Papers on Current Finance; Lavington, The English Capital Market; Döring, Die Geld Theorien seit Knapp; Keynes, Monetary Reform.

*  *  *  *  *  *  *  *  *  *  *

12. — Z and — The Stock Exchange Speculative Markets, and Dealing, a course of six lectures by Dr. Gregory, on Tuesdays, at 11 a.m., in Summer Term, beginning 28th April.

[For B.Com., Group A, and B.Sc. (Econ.), Final — special subject.]

Fee:— 12s.

¶ For evening students the same course will be given on Tuesdays, at 7 p.m., beginning 28th April.

Fee:— 8.

Syllabus.

Markets, Valuation, and the Function of the Dealer. The Machinery of the Speculative Market. How far it requires organisation and regulation. The Stock Exchange as an example of the speculative market, and an indispensable adjunct of the banking system. Constitution of the London Stock Exchange. Methods of Dealing. The Settlement. Comparison with Foreign Markets. Promotion and Issue. The general causes affecting the value of securities.

       BOOKS RECOMMENDED. — Emery, Speculation on the Stock and Produce Exchanges of the U.S.A.; Emery, Ten Years’ Regulation of the Stock Exchange in Germany (Yale Review, May, 1908); Van Antwerp, New York Stock Exchange from Within; Lavington, The English Capital Market; Schwabe, Effect of War on Stock Exchange Transactions, 1915; Sayous, Les Bourses Allemandes de Valeurs et de Commerce; J. G. Smith, Organised Produce Markets; Reports on Cotton Exchange Methods, U.S. Commr. of Corporations 1908-14; various articles by Messrs. Emery, Stevens, Flux, Hooker, Chapman, Lexis, &c.; Burn, Stock Exchange Investments; Mead, Corporation Finance; Young, Plain Guide to Investment and Finance — 3rd Edition, 1919; Greenwood, Foreign Stock Exchange Practice and Company Laws; Reports of the U.S. [National] Monetary Commission.

*  *  *  *  *  *  *  *  *  *  *

13. — A. — The History of Currency and Banking, with special reference to England, a course sixteen lectures, by Dr. Gregory, on Thursdays, at 5 p.m., in Lent and Summer Terms, beginning L.T. 15th January, S.T. 30th April.

[For B.Sc. (Econ.), Final—special subject.]

Fee for the course: £2; L.T., £1 10s.; S.T., 15s.

Syllabus.

The monetary system in the Middle Ages. History of the English silver pound. The silver famine and the effects of the supplies from the American mines. The controversy on the export of bullion and the Act of 1663. The early goldsmith bankers and the rise of banking in England. The foundation and early history of the Banks of England, Scotland and Ireland. The recoinage of 1696. The guinea and its ratings. Sir Isaac Newton’s reports on the currency. The recoinage of 1774. The restrictions on the tender of silver, Lord Liverpool’s Report of 1805, and the adoption of the gold standard.     The different developments of banking in England, Scotland and Ireland during the eighteenth century. The commercial expansion after 1763. The restriction of cash payments. The Bullion Committee. Lord Stanhope’s Act. The resumption of cash payments, and the various currency proposals made in connection with it by Ricardo, Baring and Huskisson.

       The modifications of the privileges of the Bank of England, and the rise of the English joint stock banks. The Bank Acts of 1844 and 1845. Recent developments in Banking.

       Throughout the course the attention of students will be specially directed to the study of important documents and to the sources of historical information generally.

BOOKS RECOMMENDED. — Ruding, Annals of the Coinage (for reference); Dana Horton, The Silver Pound; Chalmers, Colonial Currencies (for reference); Lord Liverpool, Treatise on the Coins of the Realm; Andréadès, History of the Bank of England; Powell, The Evolution of the Money Market, 1385-1915; Bisschop, The London Money Market, 1640-1826; Ricardo, Currency Tracts in McCulloch’s edn. of the Works, also partly reprinted as Ricardo’s Economic Essays (Bell & Sons, 1923); Graham, The One-pound Note in the History of Banking in Great Britain; Cannan, The Paper Pound: 1797-1821; Tooke and Newmarch, History of Prices (for reference); Bankers’ Magazine (for reference); Various Parliamentary and other Reports: especially the Reports of 1810 and 1819; Royal Mint: Statutes, etc., relating to the Coinage of the British Empire; Reports of the U.S.[National] Monetary Commission (for reference).

*  *  *  *  *  *  *  *  *  *  *

14. — Z and A. — The Foreign Exchanges and International Banking, a course of five lectures by Dr. Gregory, on Thursdays, at 12 noon, in Summer Term, beginning 30th April.

[For B.Com., Group A, and B.Sc. (Econ.), Final—special subject.]

Fee:— 10s.

¶ For evening students the same course will be given on Thursdays, at 7 p.m., beginning 30th April.

Fee:— 6s. 8d.

Syllabus.

The concept of Foreign Exchange. Types of Bills of Exchange. Quotations and Markets. Bankers’ credits in relation to the Exchanges. The Discount Market and its relation to Finance Bills. Arbitrage. Forward purchases and sales of Bills. The regulation of Exchange rates by discount rate variations. The fundamental causes of Exchange movements, the purchasing power parity. The development of the theory of the Exchanges. The organisation of International Banking. Exchange in relation to trade. “Exchange dumping.”

BOOKS RECOMMENDED. — Whitaker, Foreign Exchange; O. Haupt, Arbitrages et Parités; Spalding, Foreign Exchange and Foreign Bills; Escher, Foreign Exchange Explained, Kemmerer, Modern Currency Reforms; Manual of Emergency Legislation (Financial Edition); Gregory, Foreign Exchange Before, During and After the War; Cassel, The World’s Monetary Problems (Constable & Co.); Cassel, Money and Exchange since 1914; J. M. Keynes, in the Manchester Guardian Reconstruction Numbers.

*  *  *  *  *  *  *  *  *  *  *

15. — Z and A. — Banking and Finance in the Principal Countries, a course of forty lectures by Miss Tappan (T.) and Dr. Gregory (L.T.), on Tuesdays, at 12 noon, and Wednesdays, at 11 a.m., beginning M.T. 7th October, L.T. 13th January.

[For B.Com., Group A, and B.Sc. (Econ.), Final — special subject.]

Fee: — Sessional, £5; Terminal, £3.

¶ For evening students the same course of lectures will be given on Tuesdays, at 8 p.m., and Wednesdays, at 7 p.m., beginning 7th October.

Fee: — Sessional, £3 6s. 8d.; Terminal, £2.

(a) The U.S.A., South America and the Near East, twenty lectures by Miss Tappan, in the Michaelmas Term.

(b) Europe, twenty lectures by Dr. Gregory, in the Lent Term.

Syllabus.

This course will describe the main features in the evolution of the Currency and Banking Organisation of the countries concerned; the present position and the main problems of current interest.

*  *  *  *  *  *  *  *  *  *  *

16.¶ — Z and A. — Banking in the British Dominions, a course of nine lectures by Dr. Gregory, on Thursdays, at 7 p.m., in the Lent Term, beginning 15th January.

[For B.Com., Group A, and B.Sc. (Econ.), Final—special subject.]

Fee: — 18s.

Syllabus.

The legal position and present economic organisation of Banking and Currency in Canada, South Africa, Australasia and India.

*  *  *  *  *  *  *  *  *  *  *

17. — A. — Recent Monetary History and Monetary Controversies: an Introduction to the Monetary History of the Modern World, a course of six lectures by Dr. Gregory, on Wednesdays, at 5 p.m., in the Summer Term, beginning 29th April.

[For B.Com., Group A, and B.Sc. (Econ.), Final.]

Fee: —12s.

Syllabus.

The triumph of the gold standard in the last third of the 19th century. The re-opening of controversy; bimetallism, the gold exchange standard. The theoretical implications of the gold exchange standard. The revival of monetary mysticism. Knapp and his followers. The rise of prices and the suggested stabilisation of the value of money. Fisher’s Compensated Dollar. The spread of banking and the evolution of banking theory: was there a philosophy of Central Banking at all? The War and the ruin of the gold standard. Cassel’s theory of the Foreign Exchanges. The Monetary theories of the Brussels and Genoa Conferences Stabilisation and the Discount Rate.

*  *  *  *  *  *  *  *  *  *  *

18.¶ — Banking Class, for students taking B.Com., Group A. or taking Banking as their special subject for the Final B.Sc, (Econ.), by Miss Tappan, in the Michaelmas Term on Tuesdays. at 3 p.m., beginning 14th October (day students); and Mondays, at 8 p.m., beginning 13th October (evening students). This class will be held by Dr. Gregory in the Lent and Summer Terms; on Tuesdays at 3 p.m., beginning 20th January (day students), and Thursdays at 6 p.m. beginning 22nd January (evening students).

N.B. — Reference should also be made to the following courses:—

No. 1. Accounts I.
No. 2. Accounts II.
No. 132. Mercantile Law (I.).
No. 135. Law of Banking.

Source: London School of Economics and Political Science, Calendar for Thirtieth Session 1924-25, pp. 72-75.

Image Source: Wikimedia commons. Portraits (from the 1930s?) of Theodore Emmanuel Gregory and Marjorie Tappan Hollond. Both images smoothed and colorized by Economics in the Rear-view Mirror.

Categories
Exam Questions Harvard International Economics Suggested Reading

Harvard. Undergraduate International Economics. Book list and final exam. Caves, 1963-1964

Harvard Square in February 1964

While the memo to the libraries promises a full reading list for the course on international trade and finance to come as soon as possible, there was no copy of Richard Caves’ full reading list for the first semester of 1963-64 to be found with other economics course syllabi in the Harvard archives. Still the twenty items arranged in approximate order of use together with the final exam questions for the course give us a good idea of the course content.

________________________

Course Announcement

Economics 148. International Trade: Basic Facts and Policies

Half course (fall term). Tu., Th., (S.), at 12. Professor Caves

Treats such problems as the balance of payments, the dollar market, capital movements, exchange rates, exchange control, European integration and the relation of domestic and international policies.

Source: Harvard University. Faculty of Arts and Science. Courses of Instruction for Harvard and Radcliffe. Official Register of Harvard University, Vol. LX, No. 21 (September 4, 1963) p. 104.

________________________

Book list for Economics 148

September 11, 1963

To: Lamont, Radcliffe, Littauer Libraries
From: Richard E. Caves
Subject: book list for Economics 148, Fall Semester, 1963-64

The following books and other special materials which I plan to assign for Economics 148 (“International Trade: Basic Facts and Policies”) are arranged in the approximate order of use during the term. Heavy assignments will be made in those titles preceded by an asterisk; in general, only relatively short passages will be assigned from other titles.

Students will be urged to purchase as a basic text Charles P. Kindleberger, International Economics, 3rd ed. (Homewood, Ill.: Richard 3 D. Irwin, 1963). I expect an enrollment in the course about the same as last year, 90 to 100.

A full reading list will follow as soon as possible.

Lary, Hal B. Problems of the United States as World Trader and Banker. New York: National Bureau of Economic Research, 1963.

Allen, W. R., and Allen, C. L., eds. Foreign Trade and Finance: Essays in International Economic Equilibrium and Adjustment. New York: Macmillan, 1959.

Meier, Gerald M. International Trade and Development. New York: Harper and Row, 1963.

Kenen, Peter B. Giant Among Nations: Problems in United States Foreign Economic Policy. Chicago: Rand, McNally, 1963.

Daedalus, Summer and Fall numbers, 1962.

Vaccara, Beatrice N. Employment and Output in Protected Manufacturing Industries. Washington, D.C.: Brookings Institution, 1960.

Myrdal, Gunnar. An International Economy: Problems and Prospects. New York: Harper & Bros., 1956.

Triffin, Robert. Europe and the Money Muddle. New Haven: Yale University Press, 1957.

*Salant, Walter S. et al. The United States Balance of Payments in 1968, Washington, D.C. Brookings Institution, 1963.
[Note: Chapters 2-9 were the Reading Period assignments]

Harris, Seymour E., ed. The Dollar in Crisis. New York: Harcourt, Brace & World, 1961.

*Factors Affecting the United States Balance of Payments, Compilation of Studies, U.S. Congress, Joint Economic Committee, Subcommittee on International Exchange and Payments, 87th Congress, 2nd session. Washington, D. C.: Government Printing Office, 1962.

Tew, Brian. International Monetary Cooperation, 1945-1956. London: Hutchinson’s University Library, 1956.

Tew, Brian, The International Monetary Fund: Its Present Role and Future Prospects. Essays in International Finance, No. 36. Princeton, N.J.: International Finance Section, Princeton University, 1961.

Machlup, Fritz. Plans for Reform of the International Monetary System, Special Papers in International Economics, No. 3. Princeton, N.J.: International Finance Section, Princeton University, 1962.

Tinbergen, Jan. Shaping the World Economy: Suggestions for an International Economic Policy. New York: Twentieth Century Fund, 1962.

Asher, Robert E. Grants, Loans, and Local Currencies: Their Role In Foreign Aid. Washington, D. C.: Brookings Institution, 1961.

Millikan, M. F., and W. W. Rostow. A Proposal: Key To An Effective Foreign Policy. New York: Harper & Bros., 1957.

Mikesell, R. F. Promoting United States Private Investment Abroad. Washington, D.C. National Planning Association, 1957.

*Balassa, Bela. The Theory of Economic Integration. Homewood, Ill.: Richard D. Irwin, 1961.

Sannwald, Rolf F., and Jacques Stohler. Economic Integration: Theoretical Assumptions and Consequences of European Integration. Princeton, Princeton University Press, 1959.

Source: Harvard University Archives. Syllabi, course outlines and reading lists in Economics, 1895-2003. Box 8, Folder “Economics, 1963-1964”.

________________________

HARVARD UNIVERSITY
Department of Economics

Economics 148
Final Examination
January 21, 1964

Answer question No. 1 and three of the remaining five. The answers to all questions will be weighted equally.

  1. Describe the basic model used in the Brookings report (The United States Balance of Payments in 1968) to forecast the balance of payments and evaluate its completeness and correctness in terms of international trade theory.
    (Note: Make sure that you distinguish between the structure of the model and the assumptions made about independent variables used in the model.)
  2. Do underdeveloped countries face a conflict between the “gains from trade” and the “gains from growth”?
    Discuss critically the arguments which have been advanced for the restriction of imports by developing countries, distinguishing between arguments for across-the-board restrictions and those for restricting the inflow of particular types of commodities.
  3. A country devalues its currency. Show how the price and income adjustment mechanisms respond to affect the balance of payments. Would you normally expect the balance to improve? Is it possible for no net improvement to occur, although the price effect is favorable?
  4. Discuss the elements of the “international liquidity problem.” Would the problem disappear if the United States balance of payments (miraculously) returned to equilibrium? Appraise the extent to which at least two of the proposals for dealing with the liquidity problem would solve the essential elements of that problem, as you see them.
  5. A country forms a customs union with another. Illustrate the following effects for any one traded commodity, using diagrams, and assuming that the world’s and the partner country’s supply functions are perfectly elastic, while the domestic supply and demand functions are neither perfectly elastic nor perfectly inelastic:
    1. Tariff revenue foregone
    2. Transfer from the government to the consumers
    3. Transfer from domestic producers to consumers
    4. Change in consumers’ surplus
    5. Trade creation
    6. Trade diversion
      Briefly, how might the net effect (gain or loss) of the union on the country’s welfare be measured?
  6. Can industrialized countries increase their rates of economic growth by forming customs unions? Appraise the possible gains from faster growth in the setting of Western European economies. Could some of the effects of a customs union hamper growth, either among members or in excluded countries?

Source: Harvard University Archives. Social Sciences. Final Examinations January 1964 (HUC 7000.28, vol. 150).

Image Source: Harvard Square Snowstorm, February 1964. Boston Public Library, Boston Herald-Traveler Photo Morgue Collection. Copy downloaded from the Digital Commonwealth website.

Categories
Business Cycles Distribution Economic History Exam Questions History of Economics Industrial Organization International Economics Johns Hopkins Labor Money and Banking Public Finance Public Utilities Statistics Theory

Johns Hopkins. General Written Exam for Economics PhD. 1956

 

One is struck by the relative weight of the history of economics in this four part (12 hours total) general examination for the PhD degree at Johns Hopkins in 1956. Also interesting to note just how many different areas are touched upon. Plenty of choice, but no place to hide.

________________________

Other General Exams from Johns Hopkins

________________________

GENERAL WRITTEN EXAMINATION FOR THE PH.D DEGREE
DEPARTMENT OF POLITICAL ECONOMY

*  *  *  *  *  *  *  *  *  *  *  *  *  *  *

PART I
June 4, 1956, 9-12 a.m.

Answer two questions, one from each group.

Group I.
  1. Write an essay on the theory of capital. It should include a discussion of the place of capital theory in economic analysis: for what purposes, if any, we need such a theory, Do not omit theories or issues which were important in the history of doctrines, even if you should regard them as irrelevant for modern analysis.
  2. Discuss and compare the capital theories of Böhm-Bawerk, Wicksell, and Hayek.
  3. Write an essay on the theory of income distribution. Organize it carefully, as if it were designed for an article in the Encyclopedia of the Social Sciences. Include discussions of alternative theories such as imputation theories, residual theories, surplus value theories, etc.
Group II.
  1. The following statements attempt to show that marginal productivity theory is inconsistent with factual observation. Accepting the stated facts as given, discuss whether they call for the rejection or major modification of the theory. If so, how? If not, why not?
    1. “In the most important industries in the United States wage rates are set by collective bargaining and are largely determined by the bargaining strength of the parties. Marginal productivity of labor is neither calculated nor mentioned in the process.”
    2. “In many industries competition among employers for workers is so limited that most firms are able to pay less than the marginal productivity of labor.”
    3. “Workers in some trades — say, carpenters or bricklayers — work essentially the same way as their predecessors did fifty years ago; yet their real wages have increased greatly, probably not less than in occupations where productivity has improved considerably over the years.”
  2. The determination of first-class and second-class passenger fares for transatlantic ocean transportation involves problems of (a) joint or related cost, (b) related demand, and (c) discriminatory pricing. Discuss first in what ways these three phenomena are involved here; then formulate a research project to obtain the factual information required for an evaluation of the cost relationships and demand relationships prevailing in the case of two-class passenger ships; and finally state the criteria for judging whether the actual rate differential implies conscious discrimination in favor of first-class passengers, conscious discrimination against first-class passengers, wrong calculation and faulty reasoning on the part of the shipping lines, or any other reason which you may propose.

*  *  *  *  *  *  *  *  *  *  *  *  *  *  *

PART II
June 4, 1956, 2-5 p.m.

Answer three questions, at least one from each group.

Group I.
  1. There is a running debate on the question whether trade unions are labor monopolies. This debate obviously turns on the meaning of monopoly and on what effects union have had on their members’ wages, output, and conditions of work. Give both sides of the argument.
  2. Write an essay on the demand for labor.
  3. Write down everything you know about the incidence of unemployment among various classes of workers and about the fluctuations of unemployment over time. Discuss some of the problems of developing a workable concept of unemployment. Indicate whether the statistical behavior of unemployment throws any light on its causation.
Group II.
  1. What is a “public utility”? According to accepted regulatory principles, how are the “proper” net earnings of a utility company determined? And, finally, what factors are considered in setting an “appropriate” rate structure?
  2. What is the major purpose of the Sherman Anti-Trust Act of 1890? What are some of the more significant problems in determining what constitutes “restraint of trade”? What tests would you apply? Why?
  3. Analyze the economic effects of a corporate income tax. Be as comprehensive as you can.
  4. What are flexible agricultural price supports? Explain how they are determined and applied. Evaluate their use in the light of reasonable alternatives.

*  *  *  *  *  *  *  *  *  *  *  *  *  *  *

PART III
June 5, 1956, 9-12 a.m.

Answer three questions, one from each group.

Group I.
  1. Describe briefly Schumpeter’s theory of economic development, and comment upon the possibility of testing it empirically.
  2. Describe briefly Keynes’ general theory of employment, interest and money; state its assumptions, structure, and conclusions; and evaluate it critically in the light of more recent theoretical and empirical findings.
Group II.
  1. What characteristics of economic cycles would you consider important in a statistical study of business cycles?
  2. In the study of long-term trends, what criteria would you use in constructing index numbers of production?
  3. What measures of economic growth of nations would you us? Consider carefully the various characteristics that you would deem indispensable in measurements of this sort.
Group III.
  1. Give a brief definition, explanation and illustration for each of the following:
    1. variance;
    2. confidence interval;
    3. coefficient of regression;
    4. coefficient of correlation;
    5. coefficient of determination;
    6. regression line.

[Note: Indicate where you have confined yourself to simple, linear correlation.]

  1. Write an essay on statistical inference by means of the following three techniques:
    1. chi square;
    2. analysis of variance;
    3. multiple regression.

Indicate the types of problem in which they are used, and how each type of problem is handled.

*  *  *  *  *  *  *  *  *  *  *  *  *  *  *

PART IV
June 5, 1956, 2-5 p.m.

Answer four questions, one from each group.

Group I.
  1. Political arithmetic is a term that is applied to certain writings that appeared from roughly 1675 to 1800. What gave rise to such writings? What were the contributions of the different members of the “group”? Why should Political Arithmetic be given a terminal date?
  2. Discuss Quesnay’s Tableau Économique, Do you see in it anything of significance for the subsequent development of economic theory?
  3. Present arguments for the contention that J. B. Say was far more than “a mere disciple of Adam Smith”.
Group II.
  1. Discuss the relations between the English economic literature of the first half of the 19th century and the events, conditions, and general ideas of that time.
  2. Select three episodes in American economic history, and use your knowledge of economic theory to explain them.
Group III.
  1. Analyze the economic effects of a large Federal debt. Be as comprehensive as you can.
  2. At one time or another each of the following has been proposed as the proper objective or goal of monetary policy: (1) The stabilization of the quantity of money; (2) The maintenance of a constant level of prices; (3) The maintenance of full employment.
    Explain for each policy objective (a) what it means, that is, exactly what in “operational” terms might be maintained or stabilized; (b) how the objective could be achieved, that is, what techniques could be used to achieve it; and (a) the difficulties with or objections to the proposal.
  3. Irving Fisher and others have proposed that all bank be required to hold 100% reserves against their deposits. This was designed to prevent bank failures and, more important, to eliminate the perverse tendency of money to contract in recessions and expand in booms.
    Explain whether the proposal would have the effects claimed for it, and if so, why, and discuss what other effects it might have.
Group IV.
  1. Discuss the “law of comparative advantage” in international trade.
  2. Discuss “currency convertibility”.
  3. Discuss the “transfer problem”.
  4. Discuss the “optimum tariff”.
  5. Discuss the “foreign-trade multiplier”.
  6. Discuss alternative concepts of the “terms of trade”.
  7. Discuss the “effects of devaluation upon the balance of trade”.

*  *  *  *  *  *  *  *  *  *  *  *  *  *  *

Source: Johns Hopkins University. Eisenhower Library. Ferdinand Hamburger, Jr. Archives. Department of Political Economy Series 5/6.  Box No. 6/1. Folder: “Comprehensive Exams for Ph.D. in Political Economy, 1947-1965”.

Image Source: Fritz Machlup in an economics seminar. Evsey Domar visible sitting third from the speaker on his right hand side. Johns Hopkins University Yearbook, Hullabaloo 1956, p. 15.

Categories
Exam Questions Harvard International Economics

Harvard. Enrollment, course description, and final exam for international trade and payments. Sprague, 1904-1905

Puck. 13 March 1901.

At the beginning of the 20th century international economics was covered within a single semester course. Now it is at least a two semester sequence for international trade and international payments, respectively…and one such sequence at the undergraduate and again at the graduate level. The banking specialist, Oliver Mitchell Wentworth Sprague, would have been more interested in the payments part of the course, but the top dog in the department, Frank W. Taussig, left a strong tradition with a focus on real trade theory and commercial policy as can be seen in the exam questions below.

__________________________

Course Enrollment
1904-05

Economics 12a 2hf. Asst. Professor Sprague. — International Trade.

Total 18: 5 Graduates, 7 Seniors, 3 Juniors, 1 Sophomore, 2 Others.

Source: Harvard University. Report of the President of Harvard College, 1904-1905, p. 75.

__________________________

Course Description
1904-05

[Economics] 12a 2hf. International Trade. Half-course (second half-year) Mon., Wed., and (at the pleasure of the instructor) Fri. at 10. Asst. Professor Sprague.

Course 12a begins with a careful study of the theory of international trade, and of the use and significance of bills of exchange. The greater portion of the time will be devoted to an analysis of the foreign trade of the United States and Great Britain in order to distinguish the various factors, permanent and temporary, which determine the growth and direction of international commerce. With this purpose, also, a number of commodities important in foreign trade and produced in more than one country will be studied in detail. Each student will be given special topics for investigation which will familiarize him with sources of current information upon trade matters, such as trade journals, consular, and other government publications. In conclusion, certain topics of a general nature will be considered, among which may be mentioned, foreign investments, the effects of an unfavorable balance of payments under different circumstances, and colonial trade.

Source: Harvard University. Faculty of Arts and Sciences. Division of History and Political Science Comprising the Departments of History and Government and Economics, 1904-05 (May 16, 1904), p. 45.

__________________________

ECONOMICS 12a
Year-end Examination, 1904-05

  1. “The tendency of commerce is to bring about a more equal distribution of industry all the world over, and to give more and more importance to purely geographical conditions.” — Chisholm.
    Explain and illustrate.
  2. The extent to which coal supplies seem to determine the localization of industries in England, in Germany, and in the United States.
  3. Analyze carefully the effects upon the foreign trade of a country of a large increase in its production of gold.
  4. May free trade under any circumstances cause a decline in the population of a country?
  5. Why have commercial treaties proved an ineffective means of securing greater permanent freedom of trade?
  6. Discuss the policy and effects of “dumping.”
  7. The character and significance of the iron and steel exports of the United States.
  8. The purely commercial aspects of shipping subsidies.

Source: Harvard University Archives. Harvard University, Examination Papers 1873-1915. Box 7, Bound volume: Examination Papers, 1904-05;  Papers Set for Final Examinations in History, Government, Economics,…,Music in Harvard College (June, 1905), pp. 31-32.

Image Source: “Weighed and Not Wanting.” From Puck (March 13, 1901). Library of Congress Prints and Photographs Division Washington, D.C.

Categories
Exam Questions International Economics Johns Hopkins

Johns Hopkins. International Economics Exams. Balassa, 1968-69.

 

This post is able to match the examination questions to the corresponding reading list for one semester of Bela Balassa’s international trade theory course that he taught at Johns Hopkins in 1968-69. Alas, the archival box did not have the reading list for the second semester, but at least the exam questions for the second semester, also transcribed below, give us a good idea of the main course content during the spring of 1969.

I am also delighted to have found a picture of Bela Balassa to replace the one I had found on a webpage that, as it turns out, happens to be of an entirely different Balassa (see note at the bottom of the post for details). Professor M. Ali Khan of Johns Hopkins tipped me off about the previous picture (used in other posts) not being quite right. 

____________________________

Note: the reading list for the fall semester course was transcribed and posted earlier.

EXAMINATION
INTERNATIONAL ECONOMICS 18.641
Thursday, January 16, 1969

Dr. Balassa

  1. Answer two questions (80 minutes)
    1. Discuss the meaning of the expressions “labor” and “capital” in the Heckscher-Ohlin framework and indicate the implications that the recent interpretations of these concepts have for the theory of international trade.
    2. Analyze the relationship between country size and the commodity composition of exports and imports.
    3. Discuss the applicability of alternative theories of specialization to trade among industrial countries.
  2. Answer two questions (80 minutes)
    1. Examine the usefulness of a general equilibrium approach to trade theory.
    2. Consider the implications of introducing intermediate goods in trade models.
    3. Show the applicability of the theory of duopoly and bilateral monopoly to the theory of tariffs.
  3. Answer one question (40 minutes)
    1. State briefly the Stolper-Samuelson and the Rybczynski theorems and indicate the relationship between the two.
    2. What welfare consequences can be derived from the following results if subscript 2 refers to the after-trade and subscript 1 to the before-trade situation:

ΣP2Q2 < ΣP2Q1

ΣP1Q2 > ΣP1Q1

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Note: the reading list for the spring semester course was not included in the collection of course outlines for the department of political economy in the Johns Hopkins University archives.

Final Examination
International Trade Theory 18.642
May 21, 1969

Professor Balassa

Give approximately equal time to all questions.

  1. Answer two questions.
    1. It has been customary to consider separately internal and external balance and to examine the effects of the use of various policy instruments on each. How can this be reconciled with Johnson’s proposition that “the balance-of-payments is the difference between aggregate receipts and payments in the domestic economy:”
    2. Reformulate the exchange stability problem if the devaluation is regarded as a transfer.
    3. Indicate the effects of a devaluation on the non-merchandise items of the balance of payments.
  2. Answer two questions.
    1. Examine the welfare implications of alternative means for attaining balance-of-payments equilibrium, including devaluation, restrictions on trade, restrictions on capital movement, and domestic deflation.
    2. Milton Friedman has recently argued that the introduction of the two-tier gold market has placed the world on a dollar standard and thus the United States no longer has a balance-of-payments problem. Similar conclusions have been reached by Depres-Kindleberger-Salant on the grounds that the U.S. plays the role of the world banker. Discuss.
    3. Discuss the implications of fixed and flexible exchange rates for national monetary and fiscal policies under the assumption of perfect capital mobility.

Source: Johns Hopkins University. Eisenhower Library, Ferdinand Hamburger, Jr. Archives. Department of Political Economy Series 6. Box 3; Folder: “Graduate Exams, 1933-1965”.

Image Source: Portrait of Bela Balassa in the Johns Hopkins University Yearbook, Hullabaloo 1976.

 

Categories
Exam Questions Harvard International Economics

Harvard. Enrollment and final exam for international trade and payments. Sprague, 1903-1904

Another of our exports: the American fortune by Samuel D. Ehrhart (1901)

Time (it’s always “time” I suppose) to get back to the feeding of the slowly growing databank of Harvard economics exams with that from the semester course on international trade and payments taught by O.M.W. Sprague during the 1903-04 academic year.

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Related Posts

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Course  Enrollment

Economics 12a 2hf. Dr. Sprague. — International Trade and International Payments.

Total 23: 5 Graduates, 6 Seniors, 7 Juniors, 3 Sophomores, 2 Others. 

Source: Harvard University. Report of the President of Harvard College, 1903-1904, p. 67.

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ECONOMICS 12a
Year-End Examination. 1903-04

  1. Analyze the effects of increasing exports of commodities produced under conditions of diminishing returns upon (a) laborers and capitalists, (b) upon landlords.
  2. What significance do you attach to differences in the per capita amount of foreign trade of different countries?
  3. Sir Robert Griffin’s criticism of the young industries argument.
  4. Does the extension of our export trade to tropical countries, e.g. South America, give promise of as satisfactory results as an equal growth to other parts of the world?
  5. Indicate the more important factors which determine the localization of manufacturing industries. Have these factors the same relative importance that they had fifty years ago?
  6. Analyze the recent course of English exports, indicating the chief tendencies for the future on the assumption of an unchanged fiscal policy.
  7. Do tariff barriers exert a steadying influence upon prices?

Source:  Harvard University Archives. Harvard University, Examination Papers 1873-1915. Box 7, Bound volume: Examination Papers, 1904-05; Papers Set for Final Examinations in History, Government, Economics, … in Harvard College, p. 34.

Image Source: Samuel D. Ehrhart, “Another of our exports; the American fortune”, cover of Puck, Vol. 50, No. 1278 (1901 August 28). Library of Congress Prints and Photographs Division Washington, D.C. 20540 USA.

Categories
Economists International Economics Princeton

Princeton. The Frank D. Graham Memorial Lecturers. 1950-2023

This post is reproduces a table found in the Princeton economics department’s website that lists 69 distinguished economists who were invited by its International Economics Section (formerly known as the International Finance Section) to give the annual Frank D. Graham Memorial Lecture from 1950/51 through 2022/2023. It is quite the who has been or still is who of international economics. Some later post will deal with the historical record of the International Economics Section. For now, one more artifact added to the collection.

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Frank D. Graham taught at Princeton from 1921 until 1949, and served as the second Walker Professor of Economics and International Finance from 1945 to 1949.  Professor Graham published widely on international trade and international monetary issues. He is perhaps best known for his 1923 paper, “Some Aspects of Protection Further Considered.”  Graham’s contributions to Princeton and to international economics are honored by the Frank D. Graham Memorial Lecture, which is delivered annually by an eminent international economist.

Frank D. Graham Memorial Lecturers
(1950-2023)

1950-1951 Milton Friedman
1951-1952 James E. Meade
1952-1953 Sir Dennis Robertson
1953-1954 Paul A. Samuelson
1955-1956 Gottfried Haberler
1956-1957 Ragnar Nurkse
1957-1958 Albert O. Hirschman
1959-1960 Robert Triffin
1960-1961 Jacob Viner
1961-1962 Don Patinkin
1962-1963 Friedrich A. Lutz
1963-1964 Tibor Scitovsky
1964-1965 Sir John Hicks
1965-1966 Robert A. Mundell
1966-1967 Jagdish N. Bhagwati
1967-1968 Arnold C. Harberger
1968-1969 Harry G. Johnson
1969-1970 Richard N. Cooper
1970-1971 W. Max Corden
1971-1972 Richard E. Caves
1972-1973 Paul A. Volcker
1973-1974 J. Marcus Fleming
1974-1975 Anne O. Krueger
1975-1976 Ronald W. Jones
1976-1977 Ronald I. McKinnon
1977-1978 Charles P. Kindleberger
1978-1979 Bertil Ohlin
1979-1980 Bela Balassa
1980-1981 Marina von Neumann Whitman
1981-1982 Robert E. Baldwin
1983-1984 Stephen Marris
1984-1985 Rudiger Dornbusch
1986-1987 Jacob A. Frenkel
1987-1988 Ronald Findlay
1988-1989 Elhanan Helpman
1988-1989 Michael Bruno
1989-1990 Michael L. Mussa
1990-1991 Toyoo Gyohten
1991-1992 Stanley Fischer
1992-1993 Paul Krugman
1993-1994 Edward E. Leamer
1994-1995 Jeffrey Sachs
1995-1996 Barry Eichengreen
1996-1997 Wilfred J. Ethier
1997-1998 Maurice Obstfeld
1998-1999 Jeffrey A. Frankel
1999-2000 T.N. Srinivasan
2000-2001 Lars Svensson
2001-2002 Jean Tirole
2002–2003 Joseph Stiglitz
2003–2004 Kenneth Rogoff
2004–2005 Guillermo Calvo
2005-2006 Alan Deardorff
2006-2007 Robert E. Lucas, Jr.
2007-2008 Jonathan Eaton
2008-2009 J. Peter Neary
2009-2010 Avinash K. Dixit
2010-2011 Ricardo Caballero
2011-2012 Anthony Venables
2012-2013 Olivier Blanchard
2013-2014 Robert C. Feenstra
2014-2015 Sir Mervyn King
2015-2016 Pascal Lamy
2016-2017 Jaume Ventura
2017-2018 Robert W. Staiger
2018-2019 Samuel Kortum
2020-2021 Andrew Atkeson
2021-2022 Pinelopi (Penny) Koujianou Goldberg
2022-2023 Hélène Rey

Source: Historical list of Graham lecturers posted at the website of the Princeton economics department’s International Economics Section (formerly the International Finance Section). From the copy at the Internet Archive WaybackMachine.