INTERNATIONAL

TRADE
ECON 3
Carvel Trade
Trade across the seas as it was known then, was confined along
well-known sea routes, generally from one harbor to another
Caravan Trade
A caravan is a group of people traveling together, often on a trade
expedition. Caravans were used mainly in desert areas, where
traveling in groups aided in defense against bandits as well as
helping to improve economies of scale in trade.
KINDS OF TRADE
HOME TRADE:
Trade done within the limited of the Country is Called Home Trade or
National Trade
FOREIGN TRADE:
Trade done between the two countries is called Foreign Trade or
International Trade

The transactions in this type of trade are called Import Trade (if goods
purchased from other country and Export Trade (if goods sold to
other country)

Basic Similarities
Both deal in the same object of exchange, that is, good
and services
Both kinds of trade are carried on by individuals and
business firms.
Both domestic and international trade are stimulated by
the desire for profit
Striking Differences
Independent currency system
Tariff and other Trade Restriction
Movement of labor and capital
Nature of the market
FACTOR THAT CONTRIBUTED TO THE ACCELERATION OF
INTERNATIONAL TRADE
INDUSTRIAL REVOLUTION
COMMERCIAL DOCUMENTS
COMMERCIAL LAW
THE LAW MERCHANT
BANKING INSTITUTIONS
PORTS OF ENTRY
LAISSEZ FAIRE
Letter of Credit Cycle
IMPORTANT BASES OF
INTERNATIONAL TRADE
DIFFERENCES IN ENVIROMENTAL CONDITIONS
STAGE OF ECONOMIC DEVELOPMENT
POPULATION DISTRIBUTION
TRANSPORTATION AND COMMUNICATION FACILITIES
PRICE STRUCTURE
ADVANTAGES OF INTERNATiONAL
TRADE
Intermational trade gives rise to improved production
and specialization through geographical division of labor
international trade helps to assemble the things each
nation needs.
it help raise peoples standard of living.
it serve as a vehicle for alleviating the economic
difficulties that attend congested regions of the world.
exchange of goods tends to increase the total utility of
the goods entering the transaction.
to the economic benefit we derive from international
trade, cultural advantages may added.
Paradox of international trade
Bitter struggle for markets and raw materials
Desire for economics self-sufficiency
Economic interdependence.