Lobal Economy: Market Structures and Trade Theory

a?Answer TWO QUESTIONS
a?Word limit 1150 words for each question (excluding references)
a?Answers should be illustrated wherever possible by examples

Answers should be properly referenced and conform to an essay structure. That is, they must have an introduction stating the scope of the answer, paragraphs that focus on specific building blocks of the answer, and a conclusion that is based on the content of the answer and directly relates back to the subject of the answer. It must be written as a continuous discussion with no sub-headings or bullet points. The discussion must be supported by examples and references cited in the text. A list of references must be provided at the end, which must cite predominantly book/journal articles and authoritative sources.
*Please note: Each question must have its own introduction, conclusion and references

Topic
1.
Agricultural prices and mechanisms for their management (government and business
Market fundamentals, market structures (perfect competition, oligopoly) and the role of speculation. Short-term factors such as adverse environmental conditions and long-term ones such as a suggested a?super-cyclea in agricultural products. Mechanisms: buffer stocks, intervention prices, price agreements, trade tariffs, product diversification, long-term contracts and the use of futures and option contracts.

2.
Trade theory: Application to inter-industry and intra-industry trade
critique of traditional trade theory (absolute advantage, comparative advantage and the Heckscher-Ohlin theory). Weaknesses of traditional trade theory in explaining intra-industry trade.

Generic characteristics
All answers should conform to the following generic characteristics in addition to the specific content identified above.
a: a clear understanding of the question;
b: an answer that is focused on the question;
c: a sound grasp of the knowledge and concepts associated with the topic;
d: evidence of reading;
e: the use of examples;
f: the ability to convey ideas clearly;
g: the ability to present an argument and reach a conclusion from that argument;
h: the ability to critically appraise subject material;
i: the ability to assess and evaluate ideas;
j: the ability to present original argument based on knowledge and understanding of the literature;
k: a critical and reflective approach.