DIŞ TİCARET

It is important to understand why trade takes place between countries. The five basic reasons why trade may take place are summarized as Differences in Technology, Differences in Resource Endowments, Differences in Demand, Existence of Economies of Scale in Production, Existence of Government Policies

Existence of Government Policies: Government tax and subsidy programs alter the prices charged for goods and services. These changes can be sufficient to generate advantages in production of certain products. In these circumstances, advantageous trade may arise solely due to differences in government policies across countries.

Mercantilism can be said to be the first theory of international trade (Shenkar, Luo, Chi, 2004, p. 17). According to the mercantilist doctrine, countries should export more than they import. World wealth (gold or silver stock) is constant and cannot be increased. Therefore, there is always a contradiction among the foreign trade countries. Mercantilism is
an economic theory that holds that the prosperity of a nation is dependent upon its supply of capital, and that the global volume of international trade is “unchangeable”

David Hume constructed what has become known as the specie-flow theory of the movement of money and goods between nations to assure equilibrium among international prices and the distribution of specie (or commodity) money among countries that are trading with each other.

Laissez-faire means “leave it alone.” Usually it describes the economic policy of a government that stresses non-interference in business. The phrase laissez faire comes from the French phrase laissez faire et laissez passer, “Let be and let pass.”

Absolute advantage occurs in two ways: Natural Advantage and Acquired Advantage (Daniels, 2004, p. 145).
a. Natural Advantage; A country’s advantage to other countries due to its climate, natural resources and labor ability. Ex.; Brazil-Coffee, Saudi Arabia-Petroleum, Turkey-Hazelnut
b. Acquired Advantage; A country’s advantage in terms of products. The advantage gained in product technology is that a country produces unique products that can be easily distinguished from its competitors. Ex.; Danish silver-cutlery sets, Kütahya ceramics and porcelain

Labor productivity: The quantity of a good that can be produced per unit of labor input. It is the reciprocal of the unit labour requirement.

Opportunity cost is usually defined as the value of the next best opportunity. In the context of national production, the nation has opportunities to produce lemonade and yoghurt. If the nation wants to produce more yoghurt, because of labour resources are scarce and fully employed, in order to increase yoghurt production, it is necessary to remove the worker from the production of lemonade. The loss of lemonade production, which is necessary to produce more yoghurt, represents the opportunity cost for the economy.

Offer curve: An offer curve gives the nation’s offer of quantity of exports and imports. In this respect, it demonstrates the nation’s supply (exports) and demand (imports) offers.

Thomas Mun: He was one of the first mercantilists. In other words, he believed that a nation’s holdings of gold are the main measure of its wealth and that governments should regulate trade to produce an excess of exports over imports in order to gain more gold for the country. Later economists, from Adam Smith on, showed that trade is self regulating and that governments seeking to hoard gold or other hard currencies will make their countries worse off.

The first scientific study of international trade begins with Adam Smith’s famous book, The Wealth of Nations, published in 1776. Later on, David Ricardo, John Stuart Mill, Alfred Marshall, Eli Heckscher, Bertil Ohlin, John Maynard Keynes, Jacob Viner and Paul Samuelson made significant contributions to this theory.

Differences in Technology: Advantageous trade can occur between countries if the countries differ in their technological abilities to produce goods and services. Technology refers to the techniques used to turn resources- labour, capital, land into outputs -goods and services.

Mercantilism represented the dominant attitude toward international trade in the 17th and 18th centuries. Before the mercantilist period, it was difficult to talk about a common foreign trade in the world. The only exception to this situation silk road, which made Turkey a bridge between Europe and the Far East.

David Hume constructed what has become known as the specie-flow theory of the movement of money and goods between nations to assure equilibrium among international prices and the distribution of specie (or commodity) money among countries that are trading with each other.

Laissez-faire means “leave it alone.” Usually it describes the economic policy of a government that stresses non-interference in business. The phrase laissez faire comes from the French phrase laissez faire et laissez passer, “Let be and let pass.”

Acquired Advantage; A country’s advantage in terms of products. The advantage gained in product technology is that a country produces unique products that can be easily distinguished from its competitors. Ex.; Danish silver-cutlery sets, Kütahya ceramics and porcelain.

The term is usually attributed to David Ricardo who explained it in his 1817 book “The Principles of Taxation and Political Economy”.

Autarky: The situation in which a country does not trade with the rest of the world. Each nation must produce whatever its consumers want to consume. There is no other way to obtain goods.

Mercantilism is the first international trade theory suggested in the middle of 1500s.

We are now introducing tastes or demand preferences in a nation. These are given by community indifference curves. A community indifference curve shows the various combinations of the two commodities that provide equal satisfaction or happiness to the community. The higher the curves the more satisfaction, the lower the curves the less satisfaction is expressed.