International trade

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Monograph

Identifikator:: 1758394757

URN:: urn:nbn:de:zbw-retromon-136209

Document type:: Monograph

Author:: Taussig, Frank William http://d-nb.info/gnd/120199459

Title:: International trade

Place of publication:: New York, NY

Publisher:: Macmillan

Year of publication:: 1927

Scope:: XXI, 425 Seiten; graph. Darst.

Digitisation:: 2021

Collection:: Economics Books

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Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Part I. Theory

Collection:: Economics Books

" ge A INTERNATIONAL TRADE Still a further remark, however, is to be made, one which illus- trates once again the connection between the various parts of the structure of economic theory. Professor Marshall has taught us to distinguish between “internal” and “external” economies — between those improvements and lowered costs which arise pri- marily within each several establishment or industry and those which are the outcome chiefly of forces outside the establishment or industry. Concerning internal economies, such as mechanical inventions, scientific discoveries, better organization within the plant, little in the way of a trend or law can be made out. They come or do not come, as it so happens. But external economies have a trend which is predictable. They are in themselves the result of larger aggregate output. The mere fact that there is a larger total product of plows, motor cars, safety razors, tends to make each unit cheaper. Greater specialization and subdivision of labor become possible; there is a greater pervasive facility of industrial advance. . This is not the place for considering disputed matters relating to the general tendency. What concerns us is that it has some special consequences for the international trade of those countries which export manufactured articles. In agriculture, external economies are not indeed lacking in effect ; larger aggregate output does bring into action some causes of decrease in cost (better roads, for example, or cheaper plows); but these are offset, in part or completely, by the tendency to diminishing returns in those opera- tions which have to do with the direct culture of the soil. It is not easy to say under what conditions external economies may be so effective that agricultural costs on added yields from the same soil tend to increase or decrease as aggregate output enlarges. Some- thing of this kind may happen for a while in a country which has intelligent and progressive population. But it would seem that with growth of numbers agricultural costs must increase relatively ; that is, tho they fall, they will not fall as much as will the costs of manufactured articles. A country which is growing fast; whose industries are largely manufactures; whose exports of such goods are large; whose total output of them is increasing; whose costs

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