Traditional Trade Theory
- Created by: Helen
- Created on: 23-04-13 21:39
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- Traditional Trade Theory
- Trade theory shows why it is beneficial for a country to engage in international trade even for products it is able to produce itself
- What is Free Trade?
- Government does not attempt to influence through quotas or duties what a country can export or import
- The benefits of trade
- Efficiency
- Patterns of International Trade
- Trade Theory and Government policy
- Mercantilism
- Absolute Advantage (Smith, 1776)
- Comparative Advantage (Ricardo,1817)
- Heckscher (1919)- Olin (1933)
- Leontief Paradox (1953)
- Is Free Trade always beneficial?
- immobile resources
- diminishing returns
- dynamic effects and economic growth
- Could a rich country be worse off with Free Trade?
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