International trade

Bibliographic data

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 III. International trade under inconvertible paper

Collection:: Economics Books

THE UNDERLYING PRINCIPLES 351 t the same time with the international disturbances, it happens hat a change takes place in the effectiveness of labor in produc- ng a given article, there will be a change in the price of that rticle. If, say, the same labor produces twice as much of oolen cloth, woolen cloth will be one-half the price it was before. he general index number of prices will show a fall in prices; ut the money income of the woolen producers would be the same disregarding transitional effects) and the total money income of he population would be the same. Other prices would not be Itered. may digress for a moment to point out an analogy between he case just considered — increase in the effectiveness of American abor in producing some particular article — and the more general ase considered in earlier chapters, that of an increase in the ritish demand for American goods.! Suppose such an increase n demand, bearing in mind what it is the American exporters eally do: that it is they who really supply to the American ublic the British goods which are received in exchange for the xports. The consequence of an increase of the British demand s that more British goods are got in exchange for each unit of merican exports; hence the greater is the contribution which he American exporters make to the national dividend of goods nd services. These particular products of American labor — o we may describe the things imported from Great Britain — fall n price. But nothing else is affected. The general level of domes- ic prices remains the same, and each several domestic price remains he same.? Similarly in Great Britain. The goods which come in from America are the product of the British labor which is given to the goods exported fo Americans. That British labor 1 See Ch. 4, p. 30. ? It need hardly be remarked that temporary effects on other prices are possible. Only if the elasticity of demand for woolen cloth were exactly unity would there be complete absence of effect on other articles. If the elasticity of demand were more or less than unity, there would be some transfer of purchasing power from woolens or towards woolens (as the case might be) and therefore an influence for the time being on the prices of woolen goods, a corresponding shift of labor and capital, a readjustment in the output of the woolens and of the other goods, and finally the state of prices indicated in the text. These possibilities may be neglected in the present inquirv.

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