Int'l Trade

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International Trade
- Closed economy
  - doesn't take part in int'l trade
  - Average costs likely high
- Open economies
  - widen production possibilities greatly due to trade
also widens consumption possibilities
- Open economies
  - widen production possibilities greatly due to trade
Specialisation and division of labour
- Comparative advantage
Absolute advantage
- Specialisation and division of labour
  - Comparative advantage
Output gains
Import controls and protectionism
- International Trade
  - Closed economy
    - doesn't take part in int'l trade
    - Average costs likely high
Case against import controls
- Import controls and protectionism
Case for import controls
The pattern of world trade
North/North
- The pattern of world trade
South/North