International trade allows people to pay less for products. Some areas of the world can manufacture products for less money. Other areas excel at producing high-end, innovative products.Continue Reading
The cost of labor in China, India and other parts of the world is lower than developed nations, and they can manufacture items at a lower price point. Even after factoring in the cost of transportation, the products they manufacture as less expensive, and people around the world pay less as a result. International trade facilitates these savings.
The United States, Japan and much of Western Europe, on the other hand, have well-educated employee bases and the infrastructure needed to innovate and create new products. These products are primarily used in the developed world, but they provide benefits to developing nations as well. Inexpensive computers, for example, allow people in poorer nations to access the Internet.
However, international trade can cause short-term and long-term problems. The developed world no longer has as many low-skill manufacturing jobs as it once did. In addition, developing nations are less likely to invest in research and development, as they cannot spend as much as companies in richer nations. However, the cost savings and innovations provided by international trade are widely believed to make up for these problems.Learn more about Economics
International trade may help countries improve their own economies as well as those of other nations involved in business transactions, but it can also heavily favor large companies, leaving small businesses without a market. Global or international trade, such as commerce and sales at the national level, may help organizations expand their networks, reach new consumers and contribute to significant economic growth. However, international trade may also put small companies, such as family-owned and local operations, at a disadvantage as they cannot reach the same volume of consumers and provide competitive prices.Full Answer >
The benefits of mercantilism include increased employment, the development of new technologies and products, and positive cultural exchanges as mercantilist nations seek new markets and raw material sources, whereas the disadvantages of the system include increased conflict between nations, growth in trade protectionism and the development of trade monopolies. The Library of Economics and Liberty defines mercantilism as a form of nationalism aimed at building a wealthy and powerful state.Full Answer >
International business is the exchange of services and products among individuals or business organizations in multiple countries. It basically comprises all the business and commercial transactions that take place among different regions, nations and countries beyond political boundaries.Full Answer >
The American Economic Association states that the study of economics is primarily concerned with how people use resources, such as people's time and talent, land, equipment, products and services. Economists and students of economics study land, labor and investments of income, money, production, taxes and government spending. In particular, economics studies the idea of choice and how people and companies must make choices due to limited resources.Full Answer >