Widener University International Economics Worksheet

professor asks me to do some changes and then send it back to him,

please take look at his comments

1. I think the intro can be rewritten to be more cohesive. You guys have a paragraph named “Popular Statistics on Demographics” and discuss everything in there (e.g. demographics, growth, productivity, etc.). I think you should break it into fewer parts to make it flow better. Talk a bit about geography at the beginning, then demographics and then a quick history on China’s development.
2. In “Reasons Behind Trading Among Top Ten Countries” it would be great to see some graphs with respect to top imports and exports. When you mention numbers (e.g. “Over 160,000 Americans are employed by Chinese companies”), make sure to cite your source in a footnote. In addition, when thinking about reasons, think in terms of the models we discussed (e.g. Ricardian, factor abundance (H-O model), etc.). It would be nice to add that to the discussion as well.
3. The gravity model needs to be re-estimated. Your coefficients are extremely large. Remember in class, I used the “ln” transformation. I am not sure why you only included the number of tariff agreements with Norway (it was very random). I would like to see some distances there, sizes of trading partners and the R square should definitely be higher when you include all that information.
4. In the current account part, I would also like to see a graph of the current account. You talk about GDP a lot but GDP is not the current account. Use some of your calculations to build time-series plots of current accounts and identify top exported and top imported goods.
5. I like the part on the Central Bank. It was well written. I think you can improve it even more with some examples of interventions of the Chinese central bank in the foreign exchange market, and the effect it had on trade. You are on a good track with this part.

Please make sure to fill in all the points he mentions, it’s really important to get it all. especially point 3

please keep me updated every 6 hours about the progress.