What happens when government removes price ceilings?

http://www.wsj.com/articles/venezuela-backs-away-from-price-controls-as-citizens-go-hungry-1476475368

Price and quantity traded both increase

Why is Nigeria poor despite having abundant natural resources?

This opinion in the NYT blames protectionist policies and failure to implement the rule of law.

Haiti v. Dominican Republic

http://www.cnn.com/2016/10/11/americas/haiti-dominican-republic-visual-explainer/index.html reports that Haiti and the Dominican Republic differ remarkably despite sharing an island. The reasons why may be:

1. "In a ranking by Transparency International of corruption, Haiti ranks near the bottom as 158th out of 167 countries. Dominican Republic ranks as 103rd."
2. Haiti has a score of 6.99 (85th highest) in the Index of Economic Freedom; DR's score is 7.32 (55th highest).

Supply and demand in action in the market for apartments

Some Big U.S. Cities See Apartment Rents Fall for First Time in Years
by: Laura Kusisto
Oct 05, 2016
Click here to view the full article on WSJ.com

TOPICS: Supply and Demand

SUMMARY: Apartment rents declined in some of the country's priciest cities during the third quarter, a dramatic reversal that could signal the end of a six-year boom for the U.S. rental market.

CLASSROOM APPLICATION: Students can evaluate the effect of an increase in the supply of apartments and a decrease in job growth, which causes a decrease in demand, on apartment rents. The article also notes a "hold-up problem": Landlords typically drive a harder bargain on renewals because they know residents would rather avoid the hassle of moving.

QUESTIONS: 
1. (Introductory) What is the effect of an increase in the supply of apartments on rents?

2. (Advanced) What is the effect of a slowdown in job growth on rents?

3. (Advanced) Why do landlords typically drive a harder bargain on apartment lease renewals?

Reviewed By: James Dearden, Lehigh University

Why did Saudi Arabia push for production cuts?

Economics Drove Saudi OPEC Move
by: Summer Said and Benoit Faucon
Sep 30, 2016
Click here to view the full article on WSJ.com
Click here to view the video on WSJ.com 

TOPICS: Oil Markets

SUMMARY: Behind the kingdom's decision to agree to production cuts was a recognition of the consequences of low oil prices, according to people familiar with the matter.

CLASSROOM APPLICATION: Students can evaluate Saudi Arabia's decision to cut oil production, while exempting Iran from the cartel's production limits.

QUESTIONS: 
1. (Advanced) Why is OPEC cutting oil production? Are the production cuts motivated by government budget issues of member countries?

2. (Advanced) Why is the cartel exempting some member countries from production cuts?

3. (Introductory) What is a market-share policy, which is noted in the article?

Reviewed By: James Dearden, Lehigh University

Questions:

1. Estimate the price elasticity of oil using the data the article reports.
2. Will Saudi Arabia benefit from the cut if Iran maintains its current level of output?
3. Will Iran benefit from the cut if it maintains its current level of output?
4. When would Iran benefit more, when it maintains its current level of output or when it increases its output?

Why would OPEC want to meet with non-OPEC countries to implement a deal OPEC made to cut its output?

http://www.reuters.com/article/us-oil-opec-algeria-idUSKCN1252CN

Questions:

1. What happens to the price of oil if OPEC cuts output and non-OPEC keeps output constant?
2. When are profits higher for OPEC, when non-OPEC countries keep output constant after the cut or when non-OPEC countries increase output after the cut?
3. When are profits higher for non-OPEC, when non-OPEC countries keep output constant after the cut or when non-OPEC countries increase output after the cut?

The IMF says governments need to do more to help the people hurt by free trade agreements

https://www.theguardian.com/business/2016/sep/27/international-monetary-fund-world-economic-outlook-globalisation-free-trade

A money quote:
"The IMF noted there had been studies showing /significant and long-lasting adjustment costs/ for those whose job opportunities had been impaired by the structural changes associated with the trend, even if the lower prices generated by globalisation helped those on low incomes. 
"'An increasingly popular narrative that sees the benefits of globalisation  and trade accrue only to a fortunate few is also gaining traction,' the IMF study said. 
"'Policymakers need to address the concerns of trade-affected workers, including through effective support for retraining, skill building and occupational and geographic mobility, to mitigate the downsides of further trade integration for the trade agenda to revive.'"

http://www.wsj.com/articles/how-to-make-trade-work-for-everyone-1475621791

More money:

"Despite the tremendous benefits of trade, too many people feel it has left them behind. Other factors, including automation, may have a greater impact on dislocation. But whether adjustment is triggered by trade, by technology or by other factors, for those individuals and communities facing adjustment, the lost jobs and stagnant wages are painfully real.

"With the correct supporting domestic policies, trade will work for all. Governments can step up investment in education, job training, temporary income support, job-search assistance, and targeted trade-adjustment assistance, using approaches crafted to best fit their national circumstances. Many countries, including Singapore, Denmark and South Korea, have implemented successful adjustment programs such as these. Our institutions can help others to develop effective programs and to share cross-country experiences.

"Transforming trade into an engine of growth for all and meeting our objectives for global poverty reduction requires reinvigorating trade integration, not rolling it back. By marrying greater economic openness with supportive domestic policies, trade can play its full role in driving increased and widely shared prosperity."