Economics Stack Exchange
Economics 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.

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How could the economic cost of the world not speaking the same language be estimated?

While languages are fun and add color and flair to cultures and make the world a more interesting place, they also have a cost. Beyond the monetary costs of translation/editing/proofreading, interpretation, multi-language signage and so on, there…
Dan Dascalescu
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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 country with which it trades. I have heard,…
Mathematician
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How does a country devalue its currency?

I recently read an article in the New York Times that talked about China devaluing its currency (which I believe is held to a peg against the US Dollar). My question is: specifically what tools does a central bank of a country employ to devalue its…
rambalachandran
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Are there any states that don't have debt?

I've not been able to find any states that don't have debt to other states. This, to me at least, seems really strange. Are there any nation states that are not in debt to other states, if so which ones, and if not why can't everyone just settle…
Zell Faze
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Why are imports subtracted from GDP?

GDP is a measure of a country's production. $$GDP = C + I + G + X_n$$ $C$ = Consumer Consumption $I$ = Gross Investment $G$ = Government Expenditures $X_n$ = Exports - Imports Exports are what we produce and make a profit from by selling to buyers…
user2738698
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Are financial markets "unique" for each "currency pair", or are they simply "translated"?

This is something I've been long wondering about. Let's say that I have statistics showing the daily closing Bitcoin price in USD since early 2009. Great. Now, if I wanted to get the daily closing Bitcoin price in SEK or EUR or whatever currency…
Izak
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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 the banks interact/negotiate with each…
Jasper Citi
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Causes of trade deficit: Multiple views

I am trying to understand the causes and macroeconomic implications of running a trade deficit in the United States, and I came across a few different views on this topic. I'd like to know if there are studies that try to understand the root-cause…
Vimal
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Are there any datasets for protectionism?

Are there any data sources or variables that measure how protectionist a country is? If so, what are they?
user46226
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Generalization of the Heckscher-Ohlin Model

The Heckscher-Ohlin Model is normally presented for the case of 2 countries, 2 factors of production and 2 traded goods, leading to statements that, subject to free trade and various other assumptions: A country with a relative abundance of a…
Adam Bailey
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How is wealth created?

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. They essentially take wealth from others and…
Gold Nile
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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 necessary because of this question and some of the…
Giskard
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Can a closed economy flourish?

I was wondering if it is possible to run a country based only on domestic economy and not to enter the world economy. Basically, if certain economy of a certain country fails and poses threat to world economy, can other countries seal off their…
user8734
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Why don't prices of USA labor and Mexican labor equalise?

That Mexicans workers get paid less US workers is a dynamic which motivates the moving of production to Mexico. This idea can be abstracted to Developed Markets (DM) labor and Emerging Markets (EM) labor. This is driving many recent political…
S Meaden
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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 several countries with several goods. Can anybody…
Sergei Akbarov
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