The writing assignment is designed to give you practice in applying economic concepts to real world issues as well as to hone your argumentative and writing skills.
Grading
It accounts for 15% of the course grade. Your assignment will be graded according to the following criteria:
• Content: demonstrate clear understanding of the material and correctly apply economic concepts and theories to the issue in question.
• Organization: thoughts and arguments are developed clearly and logically.
• Writing: clear, concise, good transitions, free of spelling and grammatical errors.
Requirement
Read the article, “Offshoring and Volatility: Evidence from Mexico’s Maquiladora Industry” by Paul R.
Bergin, Robert C. Feenstra, and Gordon H. Hanson, American Economic Review, Vol. 99(4), p.1664-1671.
The article is available from TITANium course website?Course Document?Writing. Write a report on the following assigned questions in your own words.
Do not merely copy the words or sentences in the article or line up unrelated answers to the assigned questions. You may use as references the article, the textbook and lecture notes in this course. No other sources are allowed. This is an individual assignment. Do not discuss with other students about the assignment. Plagiarism will result in zero and will be reported to the Student Judicial Affairs.
Format
The report should be two to four pages, 1.5 line-spaced, 11-point font. The report needs to be typewritten using Microsoft Word. A reference list or citation list should be included at the end of your report. No handwritten papers will be accepted.
Submission
Submit two copies of the writing assignment: one hardcopy of your final written report in class and one electronic copy (Microsoft Word file) via TITANium course website?Writing Assignment Online Submission by the deadline.
(For online submission instruction, see “Guide to submit your writing assignment through Titanium.pdf” posted on TITANium course website? Writing Assignment.)
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Assignment Questions
- Start your report by writing one-two paragraphs that summarize the main points of the article.
- According to the article, how has offshoring affected the volatility of economic activity in Mexico and in the US, especially employment volatility? What is the extensive margin? What is the intensive margin? The volatility in maquiladora employment can be decomposed into the extensive and intensive margins. Which margin plays a more important role in explaining the volatility in maquiladora employment?
- Some empirical studies show that the relative wages between skilled and unskilled workers have risen (or wages for skilled workers have grown faster than that for unskilled workers) both in the US and in Mexico. What does the factor price equalization theorem imply for the relative wages between skilled and unskilled workers in a skilled-labor abundant country like the US and in an unskilled-labor abundant country like Mexico in international trade? Does the theoretical implication match the reality? Why?
- Some argue that advanced nations like the US will have to restrict their trade with low-wage countries if they want to remain basically middle-class societies. Do you agree that growing world trade is the main cause of the increasing wage inequality in the US? Based on what you have learned from the lectures, what else do you think can be the causes of this rising wage inequality in the US? Explain using the trade models or theories when appropriate.