International Trade

Why international trade is inevitable?
為何全球貿易是必須的？

Some countries lack certain natural resources 缺乏資源 or suitable climates 氣候不宜 for production of certain goods.

For countries which are not self-sufficient自給自足, they must rely on other countries through trade.

Even if two countries may be self-sufficient, sometimes they find producing particular goods costs them less. 考慮成本問題 They will then specialize in the production with lower cost and then exchange with other country to get the goods not produced. 降低成本 進行交易 以達至雙贏局面 The result will be a higher consumption of both goods for both countries.

Their benefits are due to the greater combined output after SPECIALISATION.

**FAQ

To determine whom specialises in what to be produced, and method to devide labour, we should concern about “absolute advantage”絕對優勢.

Countries considered to be have absolute advantage on a particular good refers to those countries which has higher productivity 高生產力 or output per unit of resources used. 在有限資源裏有較高產量

We have to also consider the opportunity cost.