Goal+-+Balance+of+International+Trade


 * Macroeconomic Goal of Balancing International Trade:**

“Economist would tend to agree that international trade is beneficial for all nations” (John Sayre and Alan Morris, Principles for Microeconomics, McGraw-Hill Ryerson, 2009, p27). This is because all nations encourage specialization and competition. To be more efficient in producing goods and services nations must focus on making better and cheaper products. “The difference between what a nation exports and what it imports from abroad is known as the balance of trade” (John Sayre and Alan Morris, Principles for Microeconomics, McGraw-Hill Ryerson, 2009, p27). Economic problems can occur if there is either a trade deficit or a trade surplus, which means the exports and imports are not in balance equilibrium. Interest rates and exchange rates can be affected by both trade deficits and surpluses. To achieve a balance of trade, imports and exports must equal each other.

“International trade data show seasonally adjusted imports, exports and trade balance data in Billions $US for OECD countries and major non-member economies”. []

Class notes and lectures by Dr. Stephanie Powers January 2011.