33. Discuss the political economy of these viewpoints:

(1)Trade policies that hurt far more voters than they help can be adopted.
(2)Bilateral and multilateral negotiations can lead to freer trade.
34. Trade creation and trade diversion
35. As the following figure shows, DA、SA and PA are the demand curve、supply curve and price of automobile in country A. PB and PC are the price of automobile in country B and C, respectively.
t is the tariff of automobile imposed by country A.

(1)Illustrate the direction and volume of automobile trade of Country A.
(2)If country A form a customs union with country B (the union’s tariff is still t). Will the national welfare of country A increase or decline? What does it depend on?
(3)If country A cut down tariff unilaterally to PC+t′=PB. Will the national welfare of country A higher or lower than that in (2)?
36. Eastern European nations such as Poland and Hungary joined the European Union in 2004. Discuss the potential economic costs of such an expansion of the European Union, form the point of view of (1) Eastern Europe;(2) Western Europe; and (3)other nations.

Chapter 10

37. “Japan’s experience makes the infant industry case for protection better than any theory. In the early 1950s Japan was a poor nation that survived by exporting textiles and toys. The Japanese government protected what at first were inefficient, high-cost steel and automobile industries, and those industries came to dominate world markets.” Discuss critically.
38.Suppose a country has the Harris-Todaro problem. That is, for some reason urban wages are much higher than rural, leading to inefficiently low manufacturing production, but at the same time there is high urban unemployment because rural workers migrate to the cities in search of high-wage jobs. Which of the following polices could solve the problem ? Explain them.
(1) A wage subsidy to agricultural worker
(2) A subsidy to manufacturing production
(3) A tariff or import quota on manufactured goods.