Written Assignment
ECON 421 International Trade, Fall 2020
Prof. Edward J. Balistreri
University of Ne
aska—Lincoln
Assignment Due:
25 November 2020 at 11:59pm
PDF file must be uploaded to Canvas
(no exceptions)
This document outlines the written assignment for ECON 421, International Trade, fo
the fall 2020 semester. The assignment has two parts. The first part is a data collection
and visualization exercise with some descriptive writing. The second part focuses on a short
essay about the recently USMCA agreement. More specific instructions on the two parts are
outlined below, but first some ground rules.
There will be some strictly enforced ground rules that you will want to pay close attention
to. These rules are intended to limit the scope of your project and work effort. Many
students are in different situations and these rules (while some of you might find them
i
itating) significantly reduce the open-ended nature of the project. The idea is for you to
focus on quality rather than quantity, while getting practice producing written output in a
constrained professional environment. The first ground rule is that you must upload you
assignment as a single PDF file in Canvas. If you use MSWord, for example, you will want to
use the “export” option to save as a PDF/XPS or Adobe PDF document.1 Your document
must be typed in 11 or 12 point font. Your document should include the following pages,
and the document cannot exceed 12 pages inclusive of the title and reference pages:
Title page including your name, date, and course information.
Part 1:
– Page 1, Figure 1 and Paragraph 1
– Page 2, Figure 2 and Paragraph 2
– Page 3, Figure 3 and Paragraph 3
Part 2: Essay on USMCA (you should generally target 4 to 5 pages)
References
The final ground rule is to give appropriate credit to your sources. You are encouraged to rely
heavily on your sources of information, but the words you use should be your own. Learn the
difference between plagiarism and paraphrasing (with appropriate citation). Note that an
1As an aside, if you plan on a future that includes professional writing you should consider learning to
use LATEX, as a true typesetting software package.
1
inline parenthetical citation style with a reference list is prefe
ed.2 Okay, so what do I mean
y strictly enforced? Failing to follow the rules will result in as much as a one-letter-grade
eduction in your score for each offense.
Specific instructions for each part:
1 Data and visualization (3 pages)
In part one of the project you are asked to produce three graphs (one for each page) and
comment on the information. You need to download the data and generate the appropriate
graph using your favorite software (MSExcel, for example). Do not take an image from one of
your sources (cited or otherwise). The point is for you to generate the graph, look at it, and
communicate a description of the graph in a single paragraph. You should focus on quality
over quantity in the paragraph. You do not need to comment on everything that is going on.
Pick one or two features of the graph that show a relationship with a contemporary event.
In some cases the thing that may be interesting is that the event did not seem to change
anything. If your paragraph is more than half a page you need to trim it down. Again do
not try to explain everything—focus on a couple of details of interest.
1. The US trade deficit and income:
Use a line graph to plot the US trade deficit from 2010 to March of 2019 using monthly
or quarterly data. On the same graph plot US GDP normalized to the same scale (e.g.,
use the right axis for GDP so the heights of the lines are comparable). A good source
for these data is the Bureau of Economic Analysis. Include in your plot vertical lines
indicating the timing of important political and policy events. These events must
include the 2016 election, the 2017 tax cuts, and the series of tariff increases and
trade-policy agreements under the Trump administration. The idea is to show the
changes in the trade deficit and income over time (in a roughly equivalent scale) and
elate these series with important political events. Include a paragraph of text that
comments on the content of the graph. In the text you need to describe what is in the
graph, but also indicate if and how the “events” related to the observed data.
2. The twin deficits (US trade deficit and US Government deficit):
For the second graph do the same analysis, but now plot the US trade deficit and the
US Government deficit. Again get the plots to roughly the same scale and include the
elevant trade and political events. In your paragraph be sure to indicate how the new
series (the government deficit) relates to the events and how it is related to the trade
deficit.
2Here is an example of how we cite work in economics: “Feenstra XXXXXXXXXXcovers the study of international
trade at the graduate level;” and here is another example: “One of the first papers to establish micro-
economic foundations for the gravity model of international trade is Anderson (1979).” You will see the
actual references at the end of this document.
2
3. Commodity prices:
For the third graph consider how policy effects commodity prices. Select 4 different
commodities that have published price data. You must include Soybeans and Corn
as two of the four, and you need to normalize the prices so they are comparable. Fo
example, you can scale the prices so they are all one at the start of the series.3 The
USDA is a good source for agriculture price data but finding these in a convenient
format is not necessarily transparent. As an alternative you can use other reputable
sources that have already summarized cash price series. You need not stick to agri-
culture commodities for the other three. Again include a set of relevant policy events
and write a paragraph relating the data and events. You may also want to include
important weather events to help explain the series on agricultural commodities. Fo
example, there was a big drought in 2012. If you focus on agriculture commodities the
concept of a “crop year” is more useful than the calendar year.
2 Essay on USMCA (6 pages maximum)
You are asked to write an essay on the USMCA agreement. The idea is to write something
like an extended newspaper article that summarizes what was agreed to and what are the
impacts of the agreement. Before you start, download and read the executive summary
from the United States International Trade Commission (USITC) report on the USMCA
published in April of XXXXXXXXXXYou should target no more than 4 to 5 pages for your essay, but
you are allowed up to 6 pages of text. In addition to the USITC executive summary you
should pull specific details from the relevant chapters of the report to support your essay.
In addition, you must
ing in at least 3 additional citations. That is, you should conside
how at least three other authors have commented on the USMCA to include in your essay.
References
Anderson, James E. (1979) ‘A theoretical foundation for the gravity equation.’ The American
Economic Review 69(1), 106–116
Feenstra, Robert C XXXXXXXXXXAdvanced International Trade: Theory and Evidence (Princeton:
Princeton University Press)
USITC (2019) ‘U.S.-Mexico-Canada trade agreement: Likely impact on the U.S. economy
and on specific industry sectors.’ Technical Report, United States International Trade
Commission: Publication 4889
3Just divide each price in the series by its price at the beginning of the series.
4See USITC (2019), and here is a direct link to the report itself https:
www.usitc.gov/publications
332/pub4889.pdf.
3
https:
www.usitc.gov/publications/332/pub4889.pdf
https:
www.usitc.gov/publications/332/pub4889.pdf
Data and visualization (3 pages)
Essay on USMCA (6 pages maximum)