Chapter Eighteen: How Trade Relates to Growth
We have just seen how technology is directly linked to economic growth. The developed nations that have the means of using and creating technological advancements will continually enjoy further economic growth, and underdeveloped or developing economies that invest as much as possible in the use of technologies will also enjoy growth too.
So, does trade relate to growth? There are arguments for both yes and no answers to that question. For instance, a small country with a comparative advantage and some specialization may still not be able to compete in trade for the agricultural products they sell simply because of their size.
Alternately, they might incorporate even further efforts at specialization to get a monopolistic corner of a market. For example, a small country that specializes in fair trade coffee will tend to have a comparative advantage over the larger producers because they have the means of really implementing and focusing their energies on the development of this industry.
We have been learning how trade allows nations to specialize in doing what they do best. Trade can benefit everyone in society because it allows people to specialize in activities in which they have the comparative advantage, this means that the gains from trade can be tremendous.
If you consider how the global or international market can really support comparative advantages, it is easy to see why international trade tends to continually flourish. In fact, most economies are interdependent on the other economies around the world.
Remember that today it is common for any particular good to be produced by the country that has the smaller opportunity cost for producing it. This is because this will always strengthen the economy in general by allowing all participants to benefit from their trade activities.
In the case of private label rights, trade has become the major source of income for both the buyer and the seller. If partial rights are sold by the seller to a buyer for article content, the buyer might be allowed to turn around the sell the content again to another buyer, thus increasing their sales, generating additional traffic, and increasing overall internet trade.
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