Introduction:

Theory of Comparative Advantage

comparative advantage occurs when a country is specializing in
producing goods efficiently at a lower opportunity cost than another
country in which they run international trade (Boyes, 2012). Countries
need to recognize the pros and cons of international trading to know
how it will impact their country.
Under the theory of comparative advantage, international trade pros
and cons are:
Pros

Help to increase the prosperity of the nations

As competition exists, products would be available at competitive
prices than those in the domestic economy.
International trade provides greater selection of goods.
Cow-income families will have more buying power as they could
have wider range of goods selection at cheap prices.
Countries would produce commodities proficiently and as it have
comparative advantage in producing the goods, the productivity
would increase also.
There is opportunities to open up new production possibilities as
countries access new markets and new materials.
Build better relationships between countries
International trade create higher living standards as it contribute
to the countrys economic growth.
( Hann, 2011& International Trade, 2012)

Cons

The domestic small business could be hurt by high competition

created by international trade.
country culture could be affected, when open to another country
culture.
hurt the domestic manufacturing/ industry jobs.
If the country depend on other country to require the products it
need and it stop producing that products , the national security
could be threaten as the country may not have the material to
produce the products to defend their country.

companies may construct factories in low-wage countries, so

countries would lose their comparative advantage ( Hann, 2011&
International Trade, 2012)

International trade externalities

When a country is more likely to be involved in trading internationally,
it could be impacted in positive and negative ways (Boyes, 2012).
Positive Externalities
Countrys people can benefit by creating higher standard of living and
increasing prosperity. More jobs could be created for people .Also, It
provides consumers a wider selection of products to purchase. It gives
poor families more buying power because of competition and lowers
price. (International Trade, 2012).
Negative Externalities
the international trade have also a negative impact on countries. It has
the effect of increasing the pollution as the transportation activity
would increase and also production activity would increase.
In
addition, economically, It make it hard for small businesses to start and
stay in business because of the competition created by international
trade(International Trade, 2012).
Analysis:
Examination of Thailand's & its trade partners International Trade
Patterns:
Thailand trades internationally with other countries by exporting their
excess goods and importing products that their country uses and
needs to have the economy that continues growing and prospering in
todays global market
Thailand exported $225.8 billion in 2012. Its exports include
commodities like electronics, computer parts, electrical appliances,
automobiles and parts, machinery and equipment, rubber, textiles and

footwear, rice and fishery products. Thailand top three export partners
are:

China 11.7%,
Japan 10.2%
US 9.9% (Central Intelligence Agency, 2012).

Thailand imported $219.8 billion in 2012 and its imported products

include intermediate goods, capital goods, raw materials, consumer
goods and fuels. Thailand top three import partners are:

Japan 20%
China 14.9%
UAE 6.3% (Central Intelligence Agency, 2012).

When comparing Thailand imports and exports with its top export and
import trading partners, it is observed that they import commodities
that could be consider as scarce to their country and export
commodities that they can produce efficiently and for cheaper cost
than another countries, where they can gain from trade. Thailand
follow the same pattern of its trading partners patterns .It is observed
that trading partners export commodities that they could have in
excess and can produce at cheaper cost than another country and
imports commodities that could be scarce in their country. Examples
could be given, is the United Arab Emirates exporting fuel to Thailand
and Japan importing textile from Thailand.
Conclusion:
International trade is good for economic growth as it enable countries
to require the scarce commodities in their country. Also, the country
could produce products at less cost than another country, so it will
charge less when requiring goods the country need which result in
increasing country's wealth because of gain from trade.
The
international trade could also provide many benefits for the country
such as:

Creation of jobs and Employment opportunities in developing

countries.
Better living standards.
Competition lead to improve the manufacturing quality and
increase productivity.

Skilled workers would earn higher wages.

Income growth is higher.
GDP would increase from trade.
Lower Prices because of competition and wider range of
products.
Long life expectancy for people because of the high living
standards.
Better education quality.
Nations grow faster (International Trade, 2012).

Reference
-Boyes, W. (2012). Managerial economics: Markets and the firm. (2nd
ed.). Independence, KY: South-Western Cengage Learning.
-https://www.cia.gov/library/publications/the-worldfactbook/geos/rs.html
-http://www.brighthub.com/office/finance/articles/122792.aspx
-http://www.americansworld.org/digest/global_issues/intertrade/support_trade.cfm