Stack Exchange Network

Stack Exchange network consists of 175 Q&A communities including Stack Overflow, the largest, most trusted online community for developers to learn, share their knowledge, and build their careers.

Visit Stack Exchange

Questions tagged [international-trade]

International trade theory is a sub-field of economics which analyzes the patterns of international trade, its origins, and its welfare implications.

7
votes
2answers
335 views

Ricardo's theory of comparative advantage

The aim of this question is to better explore the mathematical economics model behind Ricardo's theory of comparative advantage and the claims that can be made based on this model. This seems ...
14
votes
1answer
558 views

Have there been instances where economists have advocated a trade embargo?

Due to Comparative Advantage, it is generally accepted among economists that free-trade is the best policy for a country and increases the standard of living for the citizens of that country and the ...
4
votes
1answer
3k views

How is wealth created? [duplicate]

The production of 'goods and services' and 'innovation' is the usual answer. I feel that doesn't really answer the question. These things can be traded for wealth but they don't generate new wealth. ...
7
votes
1answer
46 views

EU and North America with CETA

The CETA trade deal is supposed to involve only the EU and Canada, but Canada has already a trade deal with the USA and Mexico : I don't understand how this is possible. For example, if I own one ...
6
votes
3answers
317 views

What are some critiques to the principle of comparative advantage?

The principle of comparative advantage says that, in a free market, any agent should produce more of the goods for which they have a comparative advantage. The model is usually applied to advocate for ...
7
votes
3answers
406 views

What arguments are there in favor of national food self-sufficiency?

National food self-sufficiency is an idea that appeals to many non-economists. For example, George W. Bush (2001): It’s important for our Nation to be able to grow foodstuffs to feed our people. ...
6
votes
2answers
2k views

Ricardo's theory of comparative advantage for many countries

In textbooks on economics the Ricardo theory of comparative advantages is explained on the example of two countries with two goods. I suppose, there must be generalizations of Ricardo's theory for ...
6
votes
1answer
94 views

US trade outpaces GDP

I notice that US exports doubled between 2000 and 2011, imports also increasing greatly, but GDP only grew by 20%. Thus, trade in the United States seems to have grown substantially faster than ...
5
votes
0answers
96 views

How does a bank convert one currency to another?

Say for example I sell ZAR and buy USD. What happens behind the scenes so that the local ZAR bank is able to deposit USD into my account? Does the bank require some sort of USD cash reserve? How do ...
5
votes
2answers
122 views

Does trade lead to economic growth in the most basic models of trade?

In the standard models of trade, such as Ricardo or Hecksher-Ohlin, I know that openness to trade will lead to increased consumption as (roughly) the consumption possibility frontier expands beyond ...
3
votes
3answers
68 views

Can anyone recommend a resource for monthly trade data for Mexico from before 2010?

Can anyone point me to a resource where I can find monthly series data (specifically for 2003-2013) on Mexico's imports and exports in nominal (current) Mexican Pesos (MEP) including broken down by ...
2
votes
2answers
120 views

Why are imported Chinese products in India cheaper than those locally produced?

Why an imported Chinese product in India is cheaper compared to a locally manufactured item?
2
votes
2answers
5k views

What does perfectly inelastic demand imply about gains from trade and domestic consumers?

Source: p 191, Question 9.7b, 9.7c, Principles of Microeconomics, 7 Ed, 2014, by NG Mankiw Consider a country that imports a good. True or false. Explain your answer. b) “If demand is perfectly ...
1
vote
2answers
120 views

Retaliating against a foreign country's import tariffs

When Trump imposes tariffs on imports from China, he is hurting American consumers who won't be able to take advantage of cheap Chinese goods. If China was to retaliate by imposing tariffs on imports ...