IBU5IBE – International Business

Assistance On International Business

Group Formation Instructions

Groups of 4 members will be formed in class in week 6. Note that groups cannot be changed after they have been confirmed to your instructor.

Submission Instructions

The assignment is to be submitted using the link provided on LMS – Assessment Section. A link will also be provided for the Excel file submission. However, the Excel file is only supporting material. All relevant tables, graphs and diagrams should be included in the Word document, as only the Word document will be considered for assessment.
Late submissions will be penalised following the La Trobe University late submission policy.
Academic Integrity means putting academic values into practice by being honest in the academic work you do at university, being fair to others, and taking responsibility for learning, and following the conventions of scholarship. It is the University’s responsibility to award credit for honestly conducted work, and it is your responsibility to ensure that you demonstrate academic integrity. Please review the page below for more information. Academic Integrity, Student administration, La Trobe University
Group Presentation. The assignment results will be presented in Week 12 in class. The presentation will carry 10 marks. Please see the rubric provided on LMS for more information on how this assignment will be marked. Feedback provided at the presentation can be used to improve the quality of the final report.

Specific Contents of the Report

Task 1. Describe the evolution of the volume of exports and imports. For this task you will need data aggregated over all products and all partners for the whole period available.

a. Generate a table with the time series of the country’s annual total exports and imports, including their annual percentage change, and the country’s annual balance of trade.
b. Add to the table the aggregate world exports for each year, as well as its annual percentage change.
c. Compute and include in the table the country’s annual export share in world exports, as well as the share annual percentage change.
d. Generate a line diagram for the country’s exports share over time. Discuss your findings.

Task 2. Analyse the degree of integration of the country to the world economy. In this point, in addition to the data downloaded in Task 1 you will need to download your country’s annual GDP at current US$.

a. Generate a table where you include annual exports, imports, GDP and your country’s openness to trade. Also include in your table the yearly change of your country’s openness to trade. Depict your country’s openness to trade values over time using a line diagram.
Trade openness is computed using the following formula:

b. Discuss your findings. Make sure that your analysis includes references to specific political or economic events that may relate to the evolution of your country’s openness to trade. Support your analysis with references to the relevant literature when appropriate.

Task 3. Analyse the pattern of exports specialisation. For this task you will need to download your country’s exports data disaggregated by products (SITC 3-digit level).

Download the data for three years: the earliest year available in your dataset, one year around the centre of your time series (possibly beginning of the 1990’s), and for the most recent year in your dataset (2022 is recommended). If you find some missing observations in your dataset that is okay, as long as there is enough data to conduct the analysis just work with what you have.

c. In your Excel spread sheet(s) calculate the index of Revealed Comparative Advantage (RCA) for each product at the SITC 3-digit level using the relevant data. Please keep RCA values to 3 decimal places. The RCA of a product $i$ of country $j$ in year $t$ is given by:

where $x_{j lt}$ is the export value of product $i$ of country $j$ at year $t$ . The denominator incorporates aggregated world values (all countries).

d. Generate 3 tables where you list the top 10 products by RCA in each of the selected years (one table per year). Each table should include the rank, product ID, product name and the corresponding RCA.

Note: The index represents the share of a particular product’s exports in total exports of a country, relative to the share of that product’s exports in total world exports. A country is said to have an RCA in a product when the corresponding index is greater than 1 ( $RC A > 1$ ).

c. Discuss your findings by analysing the patterns and overtime trends of RCA in your country. Explain the sources of the RCAs and the determinants of their change over time (when changes are observed over time). Your discussion should be supported not only by the data analysis but also by research on relevant literature and the theories studied in the subject.

Task 4. Analyse the geographical pattern of trade. For this task you will need to download trade data by trade partner.

a. Using aggregate exports by trade partner identify and report the top ten export destinations (by export value) of your chosen country. Generate a table where you include the top ten partners in each of the years selected in Task 3. Discuss your findings. Your discussion should be supported not only by the data analysis but also by research on relevant literature and the theories studied in the subject.

Task 5. Trade openness and economic inequality. Is there any relationship between trade openness and economic inequality in your selected country during the period under consideration? Select and use data provided by the World Bank and at least 2 peer-reviewed references to substantiate your answer. If the relevant statistics you choose to use in your answer are not available for the full period considered in this assignment, do not worry, work with the data that is available.