Gottfried Haberler was a teaching triple threat in the Harvard economics department in his heyday: he covered courses in theory, business cycles, and international trade. Here’s a list of posts at Economics in the Rear-view Mirror using the “haberler” tag.
This post provides the course outlines and final exams for Haberler’s two term graduate sequence in international trade (& finance) and policy from 1952-53.
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Course Announcement
Economics 243a. International Trade
Half-course (fall term). Mon., Wed., and (at the pleasure of the instructor) Fri., at 12. Professor Haberler.
Economics 243b. International Economic Policy
Half-course (spring term). Mon., Wed., and (at the pleasure of the instructor) Fri., at 12. Professor Haberler.
Properly qualified undergraduates will be admitted to this course.
Source: Harvard University Archives. Courses of Instruction, Box 6, Announcement of the Courses of Instruction offered by the Faculty of Arts and Sciences for the Academic Year 1952-53, p. 104.
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Course Enrollment
Note: the 1952-1953 Report of the President of Harvard College does not provide course enrollment statistics.
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Syllabus, Fall 1952-53
Economics 243a
Professor Haberler, Fall Term, 1952-53
International Trade — Theory
The first semester of the course will be devoted to the Theory of International Trade. The first topic will be the balance of payments mechanism, the determinants of foreign exchange rates. Later the so-called “pure theory” of international trade will be discussed, including the welfare aspects (theory of international economic policy.)
The subject of the second term will be a brief historical sketch of the evolution of commercial policy from the late eighteenth century to the present time and selected topics in the field of international economic policy with greater emphasis than in the first term on historical, institutional, political, and administrative aspects of the various problems.
Outline for First Half-Year
- International Trade and National Income
Various relations between the two
The importance of trade for various countries and its measures - International Trade in the National Accounts
International transactions of the national economic budget
The balance of payments, various forms of presentation and interpretation
Balance of international indebtedness - Foreign Exchanges and the Balance of Payments Mechanism
The foreign exchange market
Demand and supply for exports and imports and for foreign means of payments
Changes in the exchange rate, the balance of payments and the terms of trade
Price effects and income effects
The foreign trade multiplier
The transfer problem - Theory of International Division of Labor
The theory of comparative cost
Modern developments of the theory of comparative cost
Marshallian theory of reciprocal demand and supply curves
Ohlin’s general equilibrium theory - Welfare Implications of International Trade
Factor prices and international trade
Income distribution and international trade
Theory of protection and tariffs
Monopoly and monopolistic competition in international trade
Reading Assignments and Suggestions
- General
Every student should have worked through one of the existing general texts or monographs:
Brown, A. C., Industrialization and Trade, 1943.
Ellsworth, International Economics, 1938.
Ellsworth, The International Economy, 1950.
(The first book of Ellsworth is shorter and theoretical; the second much longer and historical.)
Enke and Salera, International Economics.
Haberler, Theory of International Trade.
Harrod, International Economics (3rd edition, 1939).
Meade and Hitch, Introduction to Economic Analysis and Policy, (Part V).
Marsh, World Trade and Investment.
Taussig, International Trade.
Whale, International Trade.
A short discussion of recent developments will be found in Metzler, “The Theory of International Trade,” Chapter 6 in Survey of Contemporary Economics.
There are two very useful Reading Volumes:
Readings in the Theory of International Trade (edited by H. S. Ellis and Lloyd Metzler), 1949, and
Selected Readings in International Trade and Tariff Problems (ed. Taussig), 1921.
- Assignments and Suggestions to Subjects Listed Above (in addition to relevant chapters in general texts).
- There is hardly any specific reading on this subject. But every student should have some idea of basic facts and orders of magnitude.
The Post-War Foreign Economic Policy of the United States. 6th Report of the House Special Committee on Post-War Economic Policy and Planning. House Report No. 541. Washington, 1945. (This report was written by Lloyd Metzler.)
The United States in the World Economy, U. S. Department of Commerce, 1943.
Buchanan, and Lutz, Rebuilding the World Economy, 1947.
A. J. Brown, Applied Economics, 1948; Chapter VI:
Readings, Chapters 21 and 22, by D. H. Robertson and J. Viner. - Every student should study the U.S. balance of payments and that of one or two other countries in order to get a feeling of the magnitudes involved and to familiarize himself with the methods of presentation which vary not only from country to country but often also from one year to the other for the same country.
Balance of Payments Yearbook (I.M.F.)
The United States in the World Economy, 1943.
The Balance of International Payments of the U.S., 1946-48 (1950).
Hicks, The Social Framework of the American Economy, Chapter XII, “Foreign Payments and the National Income” (a theoretical discussion).
Marsh, World Trade and Investment, Chapters 9, 10, 11, 12. - In addition to relevant chapters in general texts, see the following:
Haberler, “The Market for Foreign Exchange and the Stability of the Balance of Payments”, Kyklos, Vol. III, 1949.
Harris (ed.), Foreign Economic Policy for the U.S., Part V, Chs. 20, 21 22.
Harris (ed.), The New Economics, Part V, especially essays by Bloomfield and Nurkse.
Iversen, International Capital Movements, 1935.
Keynes and Ohlin on German Reparations in Economic Journal, 1929; and Readings, Chapters 6 and 7.
Machlup, International Trade and the National Income Multiplier, 1943.
Machlup, “The Theory of Foreign Exchanges,” Economica, 1939 (two articles), Readings, Chapter 5.
Meade, J. E., The Balance of Payments, 1951.
Metzler, op. cit.
Nurkse, R., International Currency Experience (League of Nations, 1944).
Pigou, “The Foreign Exchanges,” Quarterly Journal of Economics, November, 1922, reprinted in Essays in Applied Economics (1927).
Robinson, J., “Beggar-My-Neighbor Remedies for Unemployment”, Readings, Chapter 17.
Robinson, J., “Foreign Exchanges,” Essays on the Theory of Employment(1st ed., 1938; 2nd ed., 1947), Part III; reprinted in Readings, Ch. 4.
Williams, Post-War Monetary Plans and Other Essays (3rd, 1947). - and 5. In addition to general texts, see:
Edgeworth, Papers Relating to Political economy, Vol. II, p. 3-60.
Ellsworth, “A Comparison of International Trade Theories,”American Economic Review, June, 1940.
Haberler, “Some Problems in the Pure Theory of International Trade”, Economic Journal, June, 1950.
Leontief, “The Use of Indifference Curves in the Analysis of Foreign Trade,” Quarterly Journal of Economics, May, 1933; Readings, Ch. 10.
Mill, Principles (relevant chapters reprinted in Selected Readings).
Ohlin, cit. Parts I, II, and possibly III.
Readings, Chs. 12, 13, 15, by J. H. Williams, E. Heckscher, and W. Stolper and P. Samuelson.
Ricardo, Principles, (relevant chapters reprinted in Selected Readings).
Robinson, J., “The Pure Theory of International Trade”, Review of Economic Studies, Vol. XIV, 1946-47.
Taussig, International Trade.
Viner, Studies in the Theory of International Trade (last two chapters).
- There is hardly any specific reading on this subject. But every student should have some idea of basic facts and orders of magnitude.
Source: Harvard University Archives. Syllabi, course outlines and reading lists in Economics, 1895-2003, Box 5, Folder “Economics, 1952-1953 (2 of 2)”.
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1952-1953
HARVARD UNIVERSITY
ECONOMICS 243a
[Final exam. January 1953]
Answer 5 questions. Write legibly.
- Suppose the international transactions of a country are as follows (in hundred million dollars):
| Commodity exports | 18 |
| Commodity imports | 20 |
| Net tourist receipts | 1 |
| Other services exported | 1 |
| Gold exports | 1 |
| Debt to IMF repaid | 1 |
| New long-term securities sold abroad | 1 |
| Long-term securities redeemed | ½ |
| Short-term balances accumulated abroad | 1 |
| Marshall aid received | 1 |
Write down the balance of payments, inserting if necessary an “errors and omissions” item.
Discuss whether the balance of payments shows a deficit or surplus, giving reasons for your answer. If you like, state alternative criteria.
- How does depreciation influence the balance of payments and the terms of trade? Discuss question in terms of relevant elasticities.
- Balance of payments adjustments in the pre-World War I era were often so rapid that they surprised the classical theorists. Show how “income effects” may help to explain these phenomena.
- List some arguments for protection and examine one of these in some detail. (Append a graphical analysis if possible).
- Compare the classical theory of comparative cost and Ohlin’s general equilibrium theory that is based on the relative scarcity of factors of production.
- Discuss J. H. Williams’ strictures against the classical theory and compare them with those of Ohlin.
- Is it possible, and if so under what conditions, that international trade changes the income distribution against a major factor of production, say, labor? Discuss policy implications.
- Show graphically how reciprocal demand curves can be used to analyze changes in the terms of trade that result from the imposition of tariffs on imports or exports.
Source: Harvard University Archives. Harvard University, Final examinations 1853-2001. (HUC 7000.28, vol. 96 [Social Sciences]). Papers Printed for Final Examinations [in] History, History of Religions, Government, Economics,…” January 1953.
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Syllabus, Spring Term, 1952-53
Harvard University
Department of Economics
Economics 243b
International Economic Policy
- Historical Introduction
Commercial Policy of the major countries from the beginning of the 19th century until 1914.
Great Britain
France
Germany
United States
Other Countries
The Inter-war period and postwar developments.
Modern methods of trade control
Quantitative controls
Quotas
Exchange control
Other methods and controls.
- Free Trade and Protection: Theoretical Economics and Practical Social Policies
The case for free trade and the free trade movement
Arguments for protection
“Non-economic” arguments
Unemployment
Balance of Payments
“Dollar shortage”
Infant industry argument and development of underdeveloped countries
Terms of Trade
International trade under planning
- Current Issues in Trade Policy
Liberalization of trade
Universal vs. regional approach
Most-favored-nation principle and discrimination
Currency convertibility
Customs Union
READING SUGGESTIONS
- General
Most treatises on International Trade discuss policy questions.
Ellsworth: The International Economy
D. March: World Trade and Investment
Haberler: Theory of International Trade
J. Viner: International Economics
J. Viner: International Trade and Economic Development
Readings in the Theory of International Trade (Blakiston)
S. E. Harris (editor): Foreign Economic Policy of the U.S. (Harvard, 1946)
N. Buchanan and F. Lutz: Rebuilding the World Economy
H. S. Ellis: The Economics of Freedom. The Progress and Future of Aid to Europe (Harper 1950)
Selected Readings in International Trade and Tariff Problems, (ed. Taussig)
J. H. Williams: Economic Stability in a Changing World. 1953.
J. H. Williams: Stamp Lecture (Harvard University Press)
- Special Subjects
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- History of Commercial Policy
Condliffe: The Commerce of Nations
Ellsworth: The International Economy [stresses the historical approach]
F. W. Taussig: U.S. Tariff History
F. W. Taussig: Some Aspects of the Tariff Question
P. Ashley: Modern Tariff History. 1904
R. F. Mikesell: United States Economic Policy and International Relations (Economic Handbook Series, 1952)
Dictionary of Tariff Information (U. S. Tariff Commission, 1924)
H. Heuser: Control of International Trade. 1939
Margaret Gordon: Barriers to World Trade. 1941 - Free Trade and Protection
[See General Treatises mentioned above]
R. Triffin: “National Central Banking and the International Economy,” Review of Economic Studies, 1946-47. Also, in same issue, three comments by Balogh, Henderson, and Harrod
J. R. Hicks: Free Trade and Modern Economics (Manchester Statistical Society, 1951)
Selected Readings in International Trade and Tariff Problems (ed. Taussig, 1921) (contains useful excerpts from A. Smith, J. S. Mill, F. List, etc.)
A. Henderson, “The Restriction of Foreign Trade,” in The Manchester School January 1949 - Reading will be announced later.
- History of Commercial Policy
Source: Harvard University Archives. Syllabi, course outlines and reading lists in Economics, 1895-2003, Box 5, Folder “Economics, 1952-1953 (2 of 2)”.
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1952-1953
HARVARD UNIVERSITY
ECONOMICS 243b
[Final Exam. May 1953]
Answer five questions. Write legibly!
- Discuss the customs union issue and evaluate the chances of this approach to furthering the international division of labor.
- List at least four concepts of “terms of trade” and discuss whether or not these concepts are “operational” (statistically observable). Also discuss the concept of “terms of trade” implied in the Marshallian reciprocal demand curve analysis.
- Cite some methods of discrimination and examine the argument that discriminatory controls are less destructive of trade and therefore more desirable than non-discriminatory controls.
- Is the phrase “dollar shortage” absurd? Discuss possible causes and cures of “dollar shortage” consistent with your evaluation of why a “dollar shortage “may exist.
- How do payments unions or clearing unions operate? What are the main problems and difficulties? State arguments for and against such arrangements.
- What is meant by “convertibility” and why is it often held to be of paramount importance?
- Tariffs, Quotas, and Exchange Control are alternative methods of controlling imports. Compare their modes of operation and discuss their comparative advantages and disadvantages.
Source: Harvard University Archives. Harvard University, Final examinations 1853-2001. (HUC 7000.28, vol. 99 [Social Sciences]). Papers Printed for Final Examinations [in] History, History of Religions, Government, Economics,…” June 1953.
Image: Radcliffe Archives. Portrait of Gottfried Haberler. (1965).