How to build an international trade course: a complete guide for lecturers

Central question: Why can two economies both gain from trade even when one is more productive in almost everything?

Start with the core economic logic rather than with policy controversy. Students need a disciplined explanation of opportunity cost, specialization and relative rather than absolute productivity before they can judge tariffs, trade agreements or market-entry choices.

What this concept covers

• Opportunity cost and comparative versus absolute advantage.
• Ricardian specialization, relative prices and the production possibility frontier.
• Terms of trade and the sources of aggregate gains from exchange.
• Why trade creates scope for consumption beyond domestic production possibilities.

Learning outcomes

• Calculate opportunity costs and identify comparative advantage.
• Explain how specialization can raise aggregate welfare.
• Distinguish productivity advantage from comparative advantage.
• Interpret a simple terms-of-trade range.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Use a two-country, two-good numerical exercise before introducing diagrams.
• Ask students to calculate autarky opportunity costs, then propose a mutually beneficial trading price.
• Close by asking what the model deliberately leaves out: distribution, scale, firms and policy.

Case-style example

Arden and Bellmere each have 100 labour hours. Arden can produce 10 tonnes of grain or 5 solar units per 10 hours; Bellmere can produce 6 tonnes of grain or 4 solar units. Students compute opportunity costs, identify comparative advantage and test a proposed exchange rate of 1 solar unit for 1.8 tonnes of grain. One group argues Arden should export both because it is absolutely more productive; another defends specialization. Students discover why relative cost, not absolute productivity, drives the basic trade result.

Where students struggle

Students frequently assume the most productive country should export everything. The teaching task is to make opportunity cost explicit and then show that the gains-from-trade result is an aggregate benchmark, not a claim that every person gains.

Reading and a quick check

Use the comparative-advantage chapter in the core textbook. Quick check: ask students to produce one sentence explaining why an absolute productivity lead does not remove the possibility of gains from trade.

Where it leads

This foundation lets the course ask a harder question: what determines actual trade patterns once technology, resources and productivity differ across countries and firms.

Central question: What determines which goods and services countries export, and how do technology and resources shape those patterns?

After comparative advantage, move from the simplest benchmark to competing explanations of trade patterns. This is where students compare productivity-based and factor-endowment accounts and learn to treat models as lenses rather than mutually exclusive truths.

What this concept covers

• Ricardian productivity differences across sectors.
• Heckscher-Ohlin logic and relative factor abundance.
• Trade in goods as an indirect exchange of factor services.
• Empirical limits of simple factor-endowment predictions.

Learning outcomes

• Compare productivity and endowment explanations of trade.
• Predict how a change in relative productivity can alter specialization.
• Apply factor-intensity reasoning to a country-industry pairing.
• Evaluate where a model fits poorly and what extra evidence is needed.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Give students country profiles with labour, capital, skills and sector-productivity data.
• Require two competing predictions: one from productivity and one from factor endowments.
• Use the disagreement to introduce empirical testing and model choice.

Case-style example

Corvia is capital rich with 75 machines per 1,000 workers, while Deltan has 22. Corvia is also 35% more productive in apparel because of automation. Students must predict trade in machinery and apparel using both productivity and factor-endowment logic, then explain why the two models give conflicting signals for apparel. Half the class must defend each model using the data. Students discover that trade patterns can reflect several mechanisms at once and that model selection is an empirical judgement.

Where students struggle

Students often memorise model predictions without stating the assumptions that produce them. Make them identify which fact in the case is doing the causal work.

Reading and a quick check

Pair the textbook chapters on Ricardian and factor-endowment trade. Quick check: give one industry and ask students which additional statistic would best distinguish the two explanations.

Where it leads

Once students can explain why trade occurs, they are ready to examine who gains, who loses and why distribution makes trade policy politically contested.

Central question: If trade raises aggregate income, why can it still create concentrated losses and political opposition?

A credible International Trade course must separate aggregate gains from distributional incidence. This concept connects trade theory to wages, factor returns, regional adjustment and the politics that emerge when gains are broad but losses are concentrated.

What this concept covers

• Specific-factors logic and short-run immobility.
• Stolper-Samuelson intuition and factor-price effects.
• Regional and occupational adjustment costs.
• Compensation, labour-market policy and the difference between efficiency and equity.

Learning outcomes

• Identify likely winners and losers from a trade-price change.
• Explain why adjustment can be slow even when aggregate gains exist.
• Distinguish efficiency claims from distributional judgements.
• Recommend evidence needed to assess a labour-market effect.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Use a tariff removal that changes one sector price and ask students to map factor exposures.
• Require a policy memo that separates total welfare from incidence.
• Compare short-run sector-specific effects with longer-run factor mobility.

Case-style example

Eastport removes a 20% tariff on imported footwear. Domestic shoe prices fall 12%, employment in the sector is expected to drop from 18,000 to 14,500, while retailers estimate annual consumer savings of $95 million. Students quantify the visible gains and losses, then recommend whether to liberalise immediately, phase the change or pair it with adjustment support. Two conclusions are defensible depending on weighting of transition costs. Students discover why aggregate welfare arithmetic does not settle the policy choice.

Where students struggle

Students jump from “trade is beneficial” to “everybody gains,” or from visible job losses to “trade is harmful.” Keep aggregate efficiency, distribution and transition policy analytically separate.

Reading and a quick check

Use the distribution chapter in the core text and a recent trade-inclusiveness reading. Quick check: ask whether compensation must actually occur for the potential-compensation logic to count as a welfare argument.

Where it leads

Distributional effects make the political economy of protection easier to understand, but first students need the modern firm and industry mechanisms behind a large share of trade.

Central question: Why do similar countries trade similar products, and why do only some firms export?

Modern trade theory explains patterns that comparative advantage alone does not: intra-industry trade, product variety, scale economies and the selection of more productive firms into export markets. This also creates a bridge from economics to competitive strategy.

What this concept covers

• Internal economies of scale and monopolistic competition.
• Intra-industry trade and gains from product variety.
• Firm heterogeneity, fixed export costs and exporter selection.
• Market size, productivity and competitive reallocation.

Learning outcomes

• Explain why scale can generate trade between similar economies.
• Identify how fixed trade costs affect exporter participation.
• Interpret why exporters tend to be larger and more productive.
• Connect industry structure to market-entry feasibility.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Give three firms different marginal costs and one common fixed export cost.
• Ask which firms export at two market sizes.
• Then discuss how lower trade costs can expand variety while intensifying competition.

Case-style example

Three home-appliance firms have unit costs of $72, $83 and $96. Exporting to Norland requires a fixed compliance cost of $600,000 and yields expected sales of 20,000 units at a $120 price. Students calculate contribution before the fixed cost and decide which firms export. A second scenario doubles demand but introduces a local rival that cuts price to $108. Teams disagree on whether the middle-productivity firm should enter. Students discover how fixed costs, scale and competitive pressure jointly shape exporter selection.

Where students struggle

Students treat “economies of scale” as a vague reason for large firms to win. Require them to identify the fixed cost, market size and margin mechanism.

Reading and a quick check

Use the scale-economies and firm-heterogeneity chapters in the core or alternative text. Quick check: why can falling trade costs cause some domestic firms to exit while still raising aggregate productivity?

Where a simulation fits

Porter's Five Forces fits once students can apply the concept to a cross-border decision. Use it after the conceptual teaching, then debrief the assumptions that drove different recommendations.

Where it leads

The next step is to examine the main instruments governments use to alter these market outcomes: tariffs, quotas and related barriers.

Central question: How do border measures change prices, quantities, government revenue and national welfare?

This is the technical core of trade policy. Students should be able to move from a policy instrument to its incidence, not simply define tariffs and quotas. The aim is to make welfare analysis usable in later debates about protection, retaliation and market access.

What this concept covers

• Import demand, export supply and the small-country tariff model.
• Consumer surplus, producer surplus, tariff revenue and deadweight loss.
• Quotas, tariff-rate quotas and quota rents.
• Large-country terms-of-trade logic and retaliation risk.

Learning outcomes

• Calculate the welfare components of a simple tariff.
• Compare tariffs and quotas under specified assumptions.
• Explain how a tariff changes domestic prices and import volumes.
• Identify when a terms-of-trade argument is strategically fragile.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Use a numerical partial-equilibrium exercise with demand and supply schedules.
• Have students compute welfare before discussing political arguments.
• Then add retaliation and ask which part of the original calculation is no longer stable.

Case-style example

Lydon imports 1 million bicycles at a world price of $300. A 15% tariff raises the domestic price to $345, domestic output from 220,000 to 310,000 units and lowers consumption from 1.22 million to 1.08 million. Students compute tariff revenue, changes in consumer and producer surplus and the efficiency loss using supplied linear curves. One team recommends the tariff for infant-industry reasons; another rejects it on welfare grounds. Students discover exactly which policy benefits are transfers and which are real losses.

Where students struggle

Students often treat tariff revenue as a national cost or count producer gains and consumer losses without netting transfers. Insist on a complete welfare ledger before interpretation.

Reading and a quick check

Use the textbook trade-policy chapter. Quick check: ask students why a quota and tariff that initially restrict imports by the same amount can diverge when demand shifts.

Where it leads

Once the mechanics are clear, students can ask why inefficient protection is politically durable and how industrial policy changes the debate.

Central question: Why do governments protect some sectors, subsidise others and accept retaliation risk?

Trade policy is not chosen by a social planner. This concept brings lobbying, concentrated interests, strategic industries, national security and industrial policy into the course while keeping the economic opportunity costs visible.

What this concept covers

• Collective-action logic and concentrated versus diffuse interests.
• Infant-industry, strategic-trade and national-security arguments.
• Subsidies, local-content rules and state support.
• Retaliation, trade wars and the credibility of temporary protection.

Learning outcomes

• Evaluate a protection argument against explicit criteria.
• Distinguish market-failure rationales from rent-seeking.
• Analyse the likely retaliation and diversion effects of industrial policy.
• Defend a policy recommendation using welfare and political-economy evidence.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Split students into consumer, producer, treasury and security perspectives.
• Give each the same policy proposal and different objectives.
• Require a final cabinet memo that identifies both the best economic case and the strongest political constraint.

Case-style example

Meridian proposes a $2.4 billion semiconductor subsidy plus a 25% local-content requirement. The industry currently imports 78% of advanced chips; officials estimate domestic capacity could reach 35% in five years, but downstream electronics firms expect input costs to rise 6%. Students recommend approve, redesign or reject, then model a retaliation scenario that reduces electronics exports by 8%. One group prioritises resilience; another prioritises downstream competitiveness. Students discover that industrial-policy appraisal requires a counterfactual, not a slogan.

Where students struggle

Students either dismiss industrial policy as protectionism or accept strategic-sector claims at face value. Ask what market failure, capability constraint or security externality the policy is meant to solve and how success will be measured.

Reading and a quick check

Assign Fajgelbaum et al. on protectionism alongside a current policy report. Quick check: what evidence would distinguish a temporary capability-building policy from a permanent transfer to incumbents?

Where a simulation fits

PESTLE Analysis fits once students can apply the concept to a cross-border decision. Use it after the conceptual teaching, then debrief the assumptions that drove different recommendations.

Where it leads

Political choices operate inside a rules-based system, so the course next turns to WTO disciplines, trade agreements and the practical meaning of market access.

Central question: What does the rules-based trading system constrain, permit and leave unresolved?

Students do not need a law course, but they do need operational literacy in the architecture that shapes tariffs, non-discrimination, non-tariff measures, regional agreements and disputes. Teach the rules as decision constraints rather than as treaty memorisation.

What this concept covers

• Most-favoured-nation treatment and national treatment.
• Bindings, market-access commitments and non-tariff measures.
• Regional and preferential trade agreements.
• Trade remedies, dispute settlement and the limits of enforcement.

Learning outcomes

• Explain the purpose of core WTO non-discrimination principles.
• Identify when a policy raises a market-access or treatment issue.
• Compare multilateral and preferential routes to liberalisation.
• Frame a trade dispute as an evidence and rules problem.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Give a short policy fact pattern and ask which WTO principle is implicated.
• Map one regional agreement against the multilateral baseline.
• Use a mock dispute panel where students separate legal question, economic effect and political response.

Case-style example

Rivermark applies a 5% tariff to imported medical devices but grants zero duty to partners in its regional agreement. It also requires all devices to pass a new domestic certification test costing $40,000 per model. Students classify each measure, identify the WTO or agreement questions raised, and advise exporter HelixMed whether to challenge, comply or redesign market entry. One team views certification as legitimate safety regulation; another sees disguised protection. Students discover why trade disputes turn on both rule design and evidence of treatment.

Where students struggle

Students confuse “trade barrier” with “WTO violation.” Make them distinguish economic restrictiveness from legal inconsistency and recognise permitted exceptions and preferential agreements.

Reading and a quick check

Use a concise WTO overview plus the core textbook policy chapter. Quick check: why can a regulation restrict trade without automatically violating WTO rules?

Where a simulation fits

PESTLE Analysis fits once students can apply the concept to a cross-border decision. Use it after the conceptual teaching, then debrief the assumptions that drove different recommendations.

Where it leads

With policy rules established, students can study how production is fragmented across borders and why resilience is not the same as self-sufficiency.

Central question: How should firms and governments balance efficiency, concentration risk and resilience in cross-border production networks?

Global value chains connect trade theory to operations and current policy. Students should learn to trace value added across borders, identify trade costs and concentration risk, and evaluate resilience choices without assuming that reshoring automatically reduces vulnerability.

What this concept covers

• Trade in intermediate inputs and value-added accounting.
• Transport, customs, time, compliance and coordination costs.
• Supplier concentration, bottlenecks and network exposure.
• Diversification, inventory, dual sourcing, friend-shoring and reshoring trade-offs.

Learning outcomes

• Map a simplified global value chain.
• Identify the main trade-cost and concentration exposures.
• Compare resilience strategies against cost and adaptability criteria.
• Evaluate when diversification is preferable to localisation.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Give a bill of materials with country origins, lead times and supplier shares.
• Ask teams to redesign the chain under two disruption scenarios.
• Require them to quantify the cost premium of resilience and defend it.

Case-style example

Orion Bikes sources 70% of batteries from one supplier in Country A at $210 per unit and 30% from Country B at $228. A third supplier in Country C offers $242 with a 20-day shorter shipping route. Students redesign sourcing for 100,000 annual units under a scenario where Country A has a 20% disruption probability. One team minimises expected cost; another imposes a 50% single-country cap. Students discover that resilience is a portfolio decision with an explicit insurance premium.

Where students struggle

Students equate resilience with domestic production. Require them to compare redundancy, diversification, visibility, inventories and contractual flexibility before choosing location.

Reading and a quick check

Assign the OECD Supply Chain Resilience Review and World Bank GVC material. Quick check: name one resilience intervention that changes exposure without changing production country.

Where a simulation fits

SWOT Analysis fits once students can apply the concept to a cross-border decision. Use it after the conceptual teaching, then debrief the assumptions that drove different recommendations.

Where it leads

The same trade-cost lens extends to services, digital trade and customs processes, where borders increasingly operate through data and regulation rather than containers alone.

Central question: How do services, data and border procedures change what it means to trade internationally?

International Trade courses that remain goods-only now miss a large part of cross-border commerce. This concept introduces services modes, digitally delivered trade, customs and paperless processes, with attention to regulatory interoperability and measurement challenges.

What this concept covers

• Modes of supplying services across borders.
• Digitally delivered services and data-enabled trade.
• Customs, documentation, standards and trade facilitation.
• Digital barriers, interoperability and the measurement of services trade.

Learning outcomes

• Distinguish major modes of services trade.
• Identify trade costs created by border procedures and regulatory fragmentation.
• Explain how digitalisation can lower some trade costs while creating new policy issues.
• Design a simple trade-facilitation improvement.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Map how a software, consulting and logistics service crosses borders.
• Give a customs process with six documents and ask students to identify delay points.
• Compare the gains from tariff reduction with gains from process simplification.

Case-style example

CloudLedger sells accounting software from Estara into three markets. Market A allows remote delivery with no localisation rule; Market B requires local data storage costing $180,000 annually; Market C requires a local reseller taking 18% of revenue. Expected annual revenue is $1.4 million, $1.8 million and $2.1 million respectively. Students rank the markets after adjusting for regulatory and channel costs. Teams disagree over whether Market C’s higher revenue offsets reduced control. Students discover why services trade costs often sit inside regulation and business models rather than at customs.

Where students struggle

Students transfer goods-trade intuition directly to services. Make them identify what crosses the border: a person, a consumer, a commercial presence, data or a remote service.

Reading and a quick check

Use the current WTO and OECD material on digital trade and trade facilitation. Quick check: ask students for one trade cost that can fall without any tariff change.

Where a simulation fits

Go To Market fits once students can apply the concept to a cross-border decision. Use it after the conceptual teaching, then debrief the assumptions that drove different recommendations.

Where it leads

Once students see how firms serve foreign markets, the next question is when they export, offshore, license or establish production through multinational activity.

Central question: When should a firm export from home, contract abroad or produce inside the foreign market?

Trade and investment are complements as well as substitutes. This concept helps students connect firm boundaries, fixed costs, control, tariffs, logistics and knowledge transfer to the make-buy-locate decision that underpins multinational production.

What this concept covers

• Horizontal and vertical FDI.
• Exporting versus foreign production under trade and fixed costs.
• Offshoring, outsourcing and firm boundaries.
• Knowledge, control, intellectual property and local-market adaptation.

Learning outcomes

• Compare export, licensing and FDI entry modes.
• Identify the fixed and variable costs that change the location decision.
• Explain horizontal versus vertical motives for FDI.
• Defend a cross-border operating-mode recommendation.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Use a simple landed-cost model before adding strategic and political risks.
• Ask teams to recommend export, contract manufacturing or greenfield FDI.
• Then change the tariff or market-size assumption and see when the answer flips.

Case-style example

Aster Pumps sells 40,000 industrial pumps annually into Koria. Export production costs $420 per unit plus $70 freight and a 10% tariff on a $650 customs value. Local production would cost $455 per unit but require a $6 million plant. Students calculate the volume at which local production breaks even, then add a 12% probability of policy disruption and a two-year setup delay. One team chooses FDI for strategic access; another retains exports for flexibility. Students discover why market size and policy risk must be analysed together.

Where students struggle

Students choose FDI because a market is “large” without modelling fixed costs, operating economics or exit risk. Keep a quantitative break-even alongside qualitative country risk.

Reading and a quick check

Use the multinational-firm chapter in the alternative textbook. Quick check: what change in trade costs would make horizontal FDI more attractive?

Where a simulation fits

PESTLE Analysis fits once students can apply the concept to a cross-border decision. Use it after the conceptual teaching, then debrief the assumptions that drove different recommendations.

Where it leads

Trade and investment choices have development, inclusion and environmental consequences, which the next concept treats explicitly.

Central question: How can trade support development while managing unequal adjustment and environmental spillovers?

This concept brings together the course’s welfare and distribution themes at the country level. Students examine export-led development, GVC upgrading, inclusion and the low-carbon transition without treating openness as either a universal cure or a universal threat.

What this concept covers

• Trade, productivity growth and structural transformation.
• GVC participation, upgrading and capability development.
• Trade, poverty, gender and regional inclusion.
• Environmental externalities, green goods and embodied carbon.

Learning outcomes

• Evaluate a trade-led development strategy against country capabilities.
• Distinguish participation in trade from upgrading within value chains.
• Assess distributional and environmental trade-offs.
• Recommend complementary domestic policies alongside trade openness.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Compare two economies with similar export shares but different domestic value added.
• Ask students to design complementary skills, infrastructure and competition policies.
• Use a carbon-intensive export sector to connect development and sustainability.

Case-style example

Nambara exports $8 billion of processed foods, but imported inputs account for 62% of export value and only 18% of workers have formal technical training. A new regional agreement could cut tariffs by 6 percentage points, while buyer sustainability standards require $220 million of sector upgrades. Students recommend whether government support should prioritise ports, skills, supplier development or green technology. Teams differ on speed versus domestic value capture. Students discover that more trade and better development outcomes are not the same policy objective.

Where students struggle

Students use export growth as a proxy for development. Require evidence on domestic value added, productivity, wages, capabilities and environmental performance.

Reading and a quick check

Assign WTO World Trade Report 2024 and World Bank WDR 2020. Quick check: give an export boom and ask which statistic would show whether domestic upgrading occurred.

Where a simulation fits

SWOT Analysis fits once students can apply the concept to a cross-border decision. Use it after the conceptual teaching, then debrief the assumptions that drove different recommendations.

Where it leads

The course closes by combining policy, sustainability and security into geoeconomic decisions under uncertainty.

Central question: How should firms and policymakers make trade decisions when security, climate policy and geopolitical alignment reshape market access?

The capstone should not become a news roundup. Use contemporary geoeconomics to force integration of tariffs, regulation, supply chains, sustainability and firm strategy. Students should leave able to distinguish a shock from a structural change and to defend a response under uncertainty.

What this concept covers

• Geoeconomic fragmentation, sanctions and export controls.
• Friend-shoring, de-risking and strategic dependencies.
• Carbon border adjustment and green trade policy.
• Country selection, industry attractiveness and go-to-market adaptation.

Learning outcomes

• Map a geopolitical or climate policy shock through a firm’s trade exposure.
• Compare exit, diversify, localise and adapt responses.
• Evaluate a carbon-border measure as both environmental policy and trade cost.
• Defend an international market-entry recommendation under uncertainty.

Supports the course learning outcomes most directly connected to this stage of the trade lifecycle.

How to teach it

• Use a final integrated case with tariff, sanctions, carbon and supply-chain data.
• Require teams to state trigger points that would change their recommendation.
• Run PESTLE and Five Forces before a final go-to-market or board memo.

Case-style example

Verdant Metals exports 180,000 tonnes of low-carbon steel to the EU at €780 per tonne. Its emissions intensity is 1.1 tCO2 per tonne versus a key rival at 1.7. A carbon border charge is expected to add €48 per tonne to Verdant and €79 to the rival, while a new trade safeguard could cap annual volume at 150,000 tonnes. Students model margin and volume effects, then choose expand EU sales, diversify to Asia or build local finishing capacity. Students discover that policy shocks can simultaneously create cost and competitive advantage.

Where students struggle

Students react to geopolitical risk with vague diversification. Require exposure measures, alternative markets, switching costs and decision triggers.

Reading and a quick check

Assign the IMF fragmentation note, WTO World Trade Report 2023 and current WTO/OECD material. Quick check: ask students to distinguish de-risking from decoupling in one operational example.

Where a simulation fits

Go To Market fits once students can apply the concept to a cross-border decision. Use it after the conceptual teaching, then debrief the assumptions that drove different recommendations.

Where it leads

This capstone integrates the course. Students should now be able to connect economic models, institutions, firm strategy and current policy into a defensible trade recommendation.

10-week course structure

Compress by combining theory pairs and integrating WTO rules with trade policy. Keep distribution, tariffs, value chains and the capstone.

14-week course structure

Use the extra time for gravity-model intuition, trade remedies, services, climate policy and a separate simulation debrief rather than simply adding more theory.

The PESTLE Analysis Simulation places students in a real, unresolved market-entry decision: whether Tesla should commit to building a Gigafactory in India or continue serving the market through imports. Growth Strategy and Risk Management teams assess the same six PESTLE dimensions from different perspectives before paired teams negotiate a final Approval Committee view.

Why it fits here

Students already know tariffs, non-tariff measures, political economy and WTO constraints, so the activity can focus on materiality, evidence, weighting and strategic consequence. It turns a descriptive country scan into a defended trade and investment recommendation.

What students do

• Assess all six PESTLE factors against a common briefing and dataset.
• Assign factor scores and allocate factor weights that total 100%.
• Write a rationale explaining why each factor matters for the import-versus-local-investment choice.
• Compare Growth Strategy and Risk Management perspectives in a paired Approval Committee.
• Submit a final PESTLE assessment and market-entry recommendation.

Recommended course placement

• At the end of Session 7 after WTO rules, trade agreements and country-risk teaching.
• Across Sessions 7 and 8 if you want the debrief to feed directly into the GVC and supply-chain discussion.
• Before a market-entry memo so students can convert weighted factors into written trade strategy.

Knowledge students should have before the simulation

• Purpose and six categories of PESTLE.
• Basic tariff, regulatory and market-access logic.
• Difference between exporting and local production or FDI.
• Ability to distinguish evidence from assumption.

Delivery format

Suggested debrief questions

• Which factor received the highest weight, and was that weighting justified by the evidence?
• Which disagreement came from role perspective rather than factual disagreement?
• How did tariff and regulatory evidence affect the import-versus-local-production choice?
• Which assumption would most likely reverse the final recommendation?
• What evidence would you still request before a real capital commitment?

The Porter's Five Forces Simulation asks students to assess the attractiveness of the U.S. premium cafe industry for BrewSphere. Growth and Risk teams analyse the same market, score new entrants, supplier power, buyer power, substitutes and rivalry, explain each score and bring the combined view into an Investment Committee recommendation.

Why it fits here

International Trade creates access, but access does not make an industry attractive. This simulation forces students to separate macro market-entry conditions from the structural pressures that determine pricing power and profitability.

What students do

• Review BrewSphere’s market-entry question and their Growth or Risk briefing.
• Score all five forces from 1 to 10 and support each score with concise case evidence.
• Compare how supplier, buyer, substitute, entry and rivalry pressures interact rather than treating them as five isolated ratings.
• Bring paired team views into an Investment Committee and recommend Go, Conditional Go or Reject.
• Review the score distribution and written reasoning in the reflection stage for debrief.

Recommended course placement

• At the end of Session 9 after firm heterogeneity, market-entry and competitive-structure teaching.
• Before Go To Market so students first decide whether the industry is attractive, then decide how to compete.
• As a two- to four-hour applied class or split across shorter sessions where timetabling requires.

Knowledge students should have before the simulation

• Purpose and basic structure of Porter’s Five Forces.
• Difference between market size and industry profitability.
• Basic international market-entry and trade-cost concepts.

Delivery format

Suggested debrief questions

• Which two forces were most material to the final recommendation and why?
• Where did Growth and Risk teams interpret the same evidence differently?
• Did any team confuse a growing market with an attractive industry?
• How would a trade-policy change alter entry barriers, supplier power or rivalry?
• What condition would turn a Go into a Conditional Go or Reject?

Use simulation outputs as evidence to support academic judgement, not as an automatic grade. Moderate against a published rubric, include individual evidence where the team output carries marks, and address free-riding through an individual defence, annotated contribution note or short reflection.

Grading with the PESTLE Analysis Simulation

Students score and weight political, economic, social, technological, legal and environmental factors, then reconcile Growth Strategy and Risk Management perspectives into a market-entry recommendation.

• Materiality: whether weights concentrate on factors that genuinely drive the decision.
• Evidence: whether scores and rationales are supported by the case rather than generic country claims.
• Integration: whether the final recommendation follows from the weighted analysis.
• Individual evidence: a short note identifying one factor the student would reweight after the Approval Committee.

Grading with the Porter's Five Forces Simulation

Growth and Risk teams score all five forces, explain their reasoning and decide Go, Conditional Go or Reject for the U.S. premium cafe market.

• Framework application: all five forces analysed as one profitability system.
• Reasoning quality: scores match the written evidence.
• Recommendation logic: the decision follows from the most material forces rather than a simple average.
• Individual evidence: a short defence of the force that most influenced the student's recommendation.

Grading with the SWOT Analysis Simulation

Students use strengths, weaknesses, opportunities and threats to form a strategic recommendation rather than a descriptive four-box list.

• Classification accuracy and evidence behind each item.
• Prioritisation of the few factors that materially change the decision.
• Quality of strategic fit between internal capability and external trade conditions.
• Individual defence of one rejected alternative.

Grading with the Go To Market Simulation

Students act as a market strategy lead, apply segmentation, targeting and positioning, then make pricing, messaging, proof and channel choices for a product launch.

• Quality of target-segment selection and explicit rejection of alternatives.
• Consistency between positioning, pricing, messaging and channel strategy.
• Adaptation to the market scenario twist and trade-related constraints.
• Individual evidence explaining which assumption changed most after the simulation.

Where the platform provides team scores, written reasoning or comparative outcomes, use them to prompt review and feedback. They should not replace the lecturer's rubric, moderation process or review of individual evidence.