The essence of international trade

International trade - the exchange of goods and services between different countries associated with the general internationalization of economic life and the intensification of the international division of labor in the scientific and technological revolution.

International trade - trade across international borders, the exchange of goods and services. The difference between countries in their competitive advantages (or comparative advantage) in the production of various products results in the international division of labor (the location of production) and determines the flow of exports and imports between the countries.

International Trade may bring advantages both in consumption and in the production. It contributes to improving the living standards and production efficiency. International trade allows countries to consume some goods and services are cheaper by importing, and get some resources and products from other countries that would not be available otherwise, as domestic manufacturers are not able to put them on the market (for example, a rare raw materials or high-tech product ).

International trade encourages efficiency by reallocating resources to those regions that are better serve by importing in those industries where the country has a competitive advantage in relation to the trading partners.

Variations in the competitive advantage of the different countries are reflected in their different cost structures (ie, competitive prices), as well as different skill levels (competitiveness of product differentiation). They, in turn, to a greater extent by large basic factors of production (natural resources, labor, capital) and the degree of economic maturity (level of income per capita, the overall levels of costs and prices, the scientific and technical skills, etc.).

The availability of resources and expertise determines the choice of products that the country could technically produce, while the relative cost, price and product differentiation determines the economic benefits from the production of the product in which it has a comparative advantage over other countries.

Foreign trade originated in ancient times. In formations based on subsistence farming in the international exchange came a small part of the products, mainly luxury goods, spices, certain types of minerals.

A powerful stimulus to the development of international trade has been a shift from subsistence to commodity-money relations, as well as the creation of national states, the establishment of industrial relations, both within countries and between them.

Creating large-scale industry allowed to make a qualitative leap in the development of the productive forces in international trade. This led to an increase in production and improve transport of goods, i.e. set the stage for the expansion of economic and trade ties between the two countries, and at the same time has increased the need for increased international trade.

At the present stage of international trade is the most advanced form of international economic

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