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  • SOCSCI 03 - ACTIVITY #3 - The Concept of International Trade - Dalere, Melvin D.. - BTVTED-GFDT 2-A

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    The document discusses international trade, including its key participants, guiding economic theories, and significance. It outlines the main theories that have historically supported international trade such as mercantilism, absolute advantage, and comparative advantage. It also describes the process of international trade and how it allows countries to solve economic problems through specialization and exchange. Finally, it notes some common obstacles to international trade like tariffs and import quotas, and emphasizes the importance for countries to develop their own industries and not rely solely on other nations.

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    The document discusses international trade, including its key participants, guiding economic theories, and significance. It outlines the main theories that have historically supported international trade such as mercantilism, absolute advantage, and comparative advantage. It also describes the process of international trade and how it allows countries to solve economic problems through specialization and exchange. Finally, it notes some common obstacles to international trade like tariffs and import quotas, and emphasizes the importance for countries to develop their own industries and not rely solely on other nations.

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    14 views2 pages

    SOCSCI 03 - ACTIVITY #3 - The Concept of International Trade - Dalere, Melvin D.. - BTVTED-GFDT 2-A

    Uploaded by

    charmaine
    The document discusses international trade, including its key participants, guiding economic theories, and significance. It outlines the main theories that have historically supported international trade such as mercantilism, absolute advantage, and comparative advantage. It also describes the process of international trade and how it allows countries to solve economic problems through specialization and exchange. Finally, it notes some common obstacles to international trade like tariffs and import quotas, and emphasizes the importance for countries to develop their own industries and not rely solely on other nations.

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    MARIANO MARCOS STATE UNIVERSITY

    College of Teacher Education

    SOCSCI 03
    THE CONTEMPORARY WORLD

    Melvin D. Dalere
    BTVTED II-A
    Feb. 11, 2021

    Appraising

    INTERNATIONAL TRADE
    Participants of International Trade 1. All countries
    2. Central firm– leader of an international
    business dealings; e.g., MNEs and SMEs.
    2.Distribution transmission negotiator– an
    expert firm that render distribution,
    provision, and commercialism services in
    the multinational value chain
    3.Facilitator – a firm that give special
    expertise in finance, the law, customs
    clearance, market research, or other
    4.Governments – active in international
    business as suppliers, buyers, and
    regulators.
    Guiding Theory/ Principles of Smith assumed that the principle of
    International Trade absolute advantage would serve as the
    basis of profitable trade.

    Mercantilism
    Absolute Advantage
    Comparative Advantage
    Proponents of the Economic Theories David Ricardo and John Stuart Mill
    explained that, “what constitutes a
    profitable trade is not in absolute advantage
    but in the comparative costs of labor
    embodied in the production”.
    Process involved in International Trade  the proper use and allocation of scarce
    resources among countries
     Developing countries can accelerate
    their economic growth by importing
    machines and adapting foreign
    technology
     countries can facilitate the acquisition
    MARIANO MARCOS STATE UNIVERSITY
    College of Teacher Education
    of relevant knowledge, ideas and skills
    to develop and further improve their
    own economy
    Reasons for trade 1. trade enables countries to solve the
    economic problem brought by scarcity
    2. the process of exchange gives direction
    and control to the market
    Obstacles to trade 1. High tariffs on imports is one easy way
    to collect taxes for the government
    2. Another is to balance international
    payments
    3. providing quotas to imports in order to
    minimize the discrepancy between imports
    and exports
    Significance of international trade It is important for a nation not to rely solely
    on other nations for many of their needs.
    Thus, a country should always venture on
    developing its industries from its own
    resources.

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