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Introduction What is international trade theory? International trade theory is basically an exercise in applied general equi- librium modeling. This means that in many cases one can use the general theorems that apply for any Arrow-Debreu economy, most notably about the existence and welfare properties of equilibria. What makes international trade a separate field is that it utilizes some assumptions that allow for much

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Chapter Objective: This chapter continues discussion of international capital markets with a discussion of the structure of the international bond market

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