International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To...
-
Upload
sheila-owens -
Category
Documents
-
view
212 -
download
0
Transcript of International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To...
![Page 1: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/1.jpg)
International Trade & its Benefits
![Page 2: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/2.jpg)
Why do Nations Trade?
• To obtain goods they cannot produce• To reflect comparative advantage- when one country produces the
product at a lower cost. - this promotes specialization• Create jobs
![Page 3: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/3.jpg)
Barriers to International Trade
• Tariffs- tax on an imported good• Quotas- blocking trade by limiting the amount a country can buy• Sometimes barriers do not work and they force consumers o pay
higher prices.• Many countries now promote free trade.
![Page 4: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/4.jpg)
Trade Agreements
• European Union (EU)- no trade barriers in Europe• North American Free Trade Agreement (NAFTA) - No trade barriers in North America (Canada, US, Mexico)• World Trade Organization – WTO - Negotiate trade rules and helps countries develop their economy
![Page 5: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/5.jpg)
Economies in Transition
![Page 6: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/6.jpg)
Changing Economies
• Transitions can occur because of the success of market economies• Russia changes from a command economy to a market economy after
the 1991 collapse of the Soviet Union.
![Page 7: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/7.jpg)
Developing Countries
• Developing countries are those whose average per capita income is a fraction of an industrialized country• Most developing countries have traditional economies - based on custom and habit
![Page 8: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/8.jpg)
Problems of Developing Countries
• High rate of population growth -Population grows faster than GDP, therefore the per capita GDP declines- each person has a smaller share of what the economy produces -Rapid population growth also results in a lack of food and housing• Geography and natural resources -Do not have access to resources and/or ocean trade routes • War -War produces debt• corruption
![Page 9: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/9.jpg)
Growth and Development of Developing Countries
• Developing countries are responsible for their own development -World Bank created recommendations for developing countries.• Many developing countries have trade barriers to protect inefficient
industries. This hurts their ability to trade and grow.
![Page 10: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/10.jpg)
Global Changes
![Page 11: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/11.jpg)
Economic Interdependence of the WorldAdvantages of global trade-Profit-Increased competition results in lower prices and more products from which to chooseDisadvantages of global trade-competition forces weak companies to collapse-Protectionism: placing a tariff on imports; causes prices to increase and leads to trade wars; creates tension and trade barriers -Too much dependency
![Page 12: International Trade & its Benefits. Why do Nations Trade? To obtain goods they cannot produce To reflect comparative advantage- when one country produces.](https://reader036.fdocuments.us/reader036/viewer/2022083009/5697bff11a28abf838cbb748/html5/thumbnails/12.jpg)
General InformationThe United States is a developed country because…- It has natural resources and/or easy access to resources- It’s citizens are educated, healthy and accustomed to work/businessDeveloped Countries…- Manufacture goods sold around the world- Consume most of the natural resources- Have more technology- Tend to have higher standard of living- Try to help developing countries through foreign aid