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 II. Problems of verification

Collection:: Economics Books

250 INTERNATIONAL TRADE Suppose that the prices of both imported and exported goods are known, and that indices of these prices have been computed. We know then whether the prices of imports in any given year are higher or lower than in the year selected as base; and so as to the prices of exports. If now imports and exports in each single year are the same in money value, it follows that a change in prices registers accurately a change in physical quantity. If prices of exports have fallen, a given money value means a larger quantity ; and conversely, if prices rise, a given money value means a smaller quantity. The mere movement of import and export prices thus registers changes in the physical quantities exchanged, if the total money value of imports in each year equals the money value of exports. The movement of prices shows the direction of the changes in physical quantities, and so of the changes in the net barter terms. The relation obviously is inverse. As export prices fall, more of exports are given; as import prices rise, less of imports are received. What is shown (to repeat) is merely whether more or less exports are bartered for a given quantity of imports than were bartered in a preceding year. We ascertain not whether the terms of trade in any year are in themselves advantageous or favorable, but only whether they have become more or less favor- able than in the preceding year. The method would be equally applicable if the imports and exports, tho not equal to each other in money value from year to year, maintained a constant proportion. If the imports were in money regularly 25 per cent greater than the exports, the recip- rocals of the import and export prices would still show the rela- tions of the changes in physical quantities. Their course would of itself suffice to show whether a more or less volume of exports was going out in exchange for a given volume of imports. In either case — equality or constant proportion — we can follow the direction of changes in the net barter terms of trade. But, as need hardly be said, the suppositions underlying this method do not conform to fact. The imports and exports of no modern country are equal to each other in money value; nor do they bear a constant proportion to each other. In the case of

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