International trade policies

(1). Brazil and Mexico have both liberalized trade since the 1980s. However, Mexican trade liberalization has gone much further; Brazil is still a fairly inward-looking (import-substitution driven) economy. What might account for this difference in paths? [Note: Your essay should include detailed analysis of NAFTA and Mercosur] [1.5 pages; 40 points].

(2). It’s widely believed that self-driving vehicles will become commonplace in the fairly new future and that their growth will be fast for years to come. Doesn’t this mean that the United States should have policies (for examples, subsidies including the possibility that the auto industry may be characterized by monopolistic competition) designed to ensure that we are a leader in the self-driving car industry?

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How does the lack of such a policy compare with China, South Korea, and selected countries in the EU (Note: you will need to do some research on this question in addition to the material in the text)? [1.5 pages; 50 points].

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