Ben En Jerry

Lecture 4: Ben & Jerrys Lecture Agenda: Trade be -Firms boldness a choice of how to move goods across b assures Well look at a case bailiwick on Ben and Jerrys. Trade be Who Cargons? Why ar nearly goods shipped by plane versus ride? These exile methods affect pricing. How has f be cost changed over automobiletridge holder? Lowering shipping cost over clock time has created immense gains from clientele. We cargon, because mountain cost argon arguably big than tariffs. Hummels paper finds that for every $1 paying in tariffs, we break $9 in dishonoration costs. Includes red-tape by customs, distribution, etc. Also, stack costs whitethorn be related to heathen ties and historic networks of colonization. The close writ large example English colonies corresponding Canada trade often easier with Eng dry land because of common legal systems, ethnic ties, etc. GATT: England wanted to animation these historical ties/ preferential relationships with its colonies. Even though GATT didnt acknowledge much for this, trade still is juicyer mingled with colonies. What makes up trade costs? 1.Travel a.Direct transportation costs distance b.25% of world trade occurs within those that plowshare a land border 2.Insurance a.Can be particularly large if goods are high value 3.Distribution Costs a.

Distribution is amazeting the car from plant to destination. acquiring it through all of the customs, to seller, etc. b.Some foretell that this is the superior comp unrivalednt costs. 4.Most of these costs must be pay up front a.Requires substantial trade financing this was highly adversely affected in the most recent credit crunch. b.Was it the enceinte recession that caused the collapse in trade, or did the collapse in trade create the huge recession? Unclear. Shipping Techniques What are the two dominant forms of transport for exporting? 1.Air 2. naval warhead These are the focus of the paper by Hummels. Why might a firm choose one over the other? -Ocean Freight: This is cheap and efficient. o...If you want to get a wide essay, order it on our website: Orderessay

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