about Dynamics of Trade?

2010-10-25 3:51 pm
According to the Dynamics of Trade, under which conditions a country losses from trade as comparative advantage of its trading partner change over time.

回答 (1)

2010-10-27 3:13 am
✔ 最佳答案
I don't understand the question.

Yes, comparative advantage does change over time - if nothing else, the experience gained from trade will change it. And yes, trade patterns change as a result with local short term pain being very common.

Classic examples are Manchester. Built on the textile trade, when foreign competition started producing significantly cheaper goods, Manchester went into decline:
http://en.wikipedia.org/wiki/History_of_Manchester#Twentieth_century
Another is Dundee with its reliance on the jute industry:
http://en.wikipedia.org/wiki/History_of_Dundee#Jute

But all that says is that relying on a single export industry is very risky; diversification pays off in the long run.

For the economy of an entire country, the biggest hit seems to come from the discoveries of buried treasure:
http://en.wikipedia.org/wiki/Resource_curse

That is much harder to deal with.

But whatever the situation, to the extent that trade is proceeding, it is hard to imagine a situation where one party is losing on its trade because of a change in comparative advantage. Usually it loses because trade declines.

All the cases I know of where one country loses in trade are where the trade was a loss from the beginning and was started only because of corruption, pressure exerted by outside governments, ignoring externalities, etc.


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