The aim of this book is to provide under-graduates and post-graduates, who are studying International Trade as part of their degree, with an intermediate text which provides a clear and comprehensive account of the most important developments currently taking place in the world trading system. The book is written for students who have at least a first-year knowledge of Economics, but prefer a topic-driven approach to the model-driven style of more traditional texts. In particular, students studying Trade as part of a degree other than Economics (e.g. Business Studies, International Business or International Relations) may find this approach more helpful. Although this book seeks to set out most of the major theories needed for an understanding of the subject, the emphasis is more on the changes that are taking place in the world trading system and how governments are responding to these changes. The student who wishes to probe more deeply into the various models used by economists to explain trade flows can seek out one of the large number of more conventional texts that are now available. My experience is that many students, especially those who are not Economics specialists, need a text that is a little more friendly and is couched more in reality than is often the case with conventional theoretical texts. Hopefully, having had a taste of the subject and acquired an interest in some of the models referred to, they will develop an interest in probing more deeply into the theoretical side of the subject matter.
A further consideration in writing this book was to provide a text on International Trade, which attached a greater importance than is often the case in the teaching of International Trade to the role that is played by the multinational company in world trade. More conventional texts tend to treat the multinational company as being of secondary importance only. Students who are interested in the factors motivating the decisions of the multinational company generally have to seek out other books. Indeed, it is still the convention in most universities to separate the study of trade from that of the firm, creating what is, largely, a false dichotomy. Today, multinational companies are the main players in the world trading system. Attempts to explain trade without giving the multinational company a prominent place leave a feeling of dissatisfaction. For students, especially students of International Business, the failure of trade economists to pay due attention to the firm is rightly regarded as naïve. As a consequence, the study of International Trade comes to seem increasingly unrealistic.
Fortunately, one of the most encouraging developments within the subject of International Trade that has taken place in recent years has been a recognition of the valuable role that theories of industrial organisation can play in