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

40 INTERNATIONAL TRADE wages vary. They do not go together as regards domestic goods; these vary from country to country, but do not necessarily vary in accord with money wages. Nevertheless, there is a sense in which high wages and high prices do go together. Money wages and domestic prices run parallel; changes in money wages tend to accompany changes in domestic prices. If anything should occur which served to raise money wages — for example, altered and more favorable terms of international trade — a corresponding change would take place in domestic prices: they would rise to the same extent. Import prices, under the action of this factor, would not rise; they would fall. But domestic prices would adjust themselves to the higher level brought about by the new international conditions. Money wages would rise first in the export industries; the rise would then spread; eventually prices of goods and money wages in the purely domestic industries would be such as to render them as attractive as the export industries. This assumes, of course, that other things remain the same; that, for example, the technical methods of production remain unchanged — that no inventions or improvements are made which serve to increase the effectiveness of labor in the domestic industries. Such changes may operate to lower the price of a domestic article or series of articles at the same time in which international conditions are tending to lower them. We should then have the familiar case of interacting causes, in which the effect of the particular cause under inquiry is modified but not wiped out by others. Setting aside qualifications of this sort, which obviously do not affect the essentials of the conclusions, we may say that the relations of money wages and domestic prices, once they are established, remain the same. Domestic prices in the United States may be higher or lower than domestic prices in Germany; if higher, then a rise in United States money wages will carry them still higher; if lower, such a rise will make them less low. It has already been intimated — to return to the main argument of this chapter — that the distinction between domestic and international commodities is an important one. How important

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