Mitchell’s Musings 5-8-2017: Your Final Exam Question Daniel J.B. Mitchell I recently placed online the PowerPoint slides (in pdf format) and other materials for courses I used to teach at UCLA in their final formats, i.e., as of 2008 when I retired.1 One of them was an introductory course in international economics. From time to time in that course’s final examination, I included a recent newspaper article that related to the course’s topics and asked the students for a critique. As it happened, at about the time I was uploading the course files, an article appeared in the Los Angeles Times that would have been a good candidate for such an exam essay, were I still teaching the class.2 There are various themes in the article such as whether President Trump overestimates the bargaining leverage that running a trade deficit with a particular country gives him. But the article also goes into whether improving the trade deficit would create more jobs, particularly in manufacturing. In prior musings, we have noted that bringing the trade balance to zero would not come close to restoring the proportion of manufacturing workers in the labor force to what it was in the 1950s. But we also noted that given the current shrunken share of the workforce in manufacturing, about one in ten U.S. jobs, moving to balanced trade would have a significant impact on that sector. If I had assigned the article as a final exam essay question, I would have hoped that the students would have directed their attention to the chart it contained below:
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Management 205a - International Economics, available at https://archive.org/details/week8-intl-2008. “Why Trump's obsession with trade deficits is misguided,” available at http://www.latimes.com/business/la-fitrade-deficit-trump-obsession-20170502-htmlstory.html. 2
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