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 I. Theory

Collection:: Economics Books

66 : INTERNATIONAL TRADE leaves the relations between the countries undisturbed. Fur- ther: an interest charge does not alter conditions for trade, even tho it act on one commodity only, provided it acts on that com- modity in the same way in both countries. The same is true (illustration in figures may be spared) if the interest charge, instead of being absent on one article while present on another, is merely greater on one than on another. If the difference is the same in both countries, international trade goes on in the same way as if this factor had not entered. But the circumstance that the rate of interest is higher or lower in a country does have an effect when the needed capital equip- ment is greater for one commodity than for another. It bears more on those commodities which are made with much capital, making them relatively higher in price in the country where there is a higher rate of interest and a higher interest charge, lower in a country where there is a lower rate. A low rate of return on capital, then, tends to give to a country a comparative advantage (i.e. the equivalent of one) for those goods which are made with much capital ; these tend to be exported from it. A high rate of interest is correspondingly a handicap on the export of these same goods, a stimulus to their import. To put it in a more concrete way, a country in which capital has accu- mulated in large amounts and in which the investors are content with a low rate of return, tends to export articles which are made with much plant, and with raw materials which it takes time to produce and transport; whereas a country in which accumulation is smaller and the interest rate is higher, tends to import such articles. High or low interest does not in itself act as an inde- pendent factor; it exercises an influence of its own only so far as it enters to greater degree in one commodity than in another. The conclusion is of essentially the same sort as that reached with regard to non-competing groups and differences of wages. So far as differences of wages are the same in two or more coun- tries, and so far as goods are made in these countries with the same assortments (combinations) of different grades of labor, inter- national trade remains as it would be in the absence of this compli-

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