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

72 Lia INTERNATIONAL TRADE machines had been carried far — doubtless farther than in any other parts of the world. In both, the effectiveness of labor was made greater by the capital-using method of production. Prob- ably the United States was somewhat in the van. Hence in those industries which were specially suitable for this method of produc- tion she had a comparative advantage. Doubtless she had in this regard an advantage in all industries, since her people thruout devised better tools than other peoples and used them better; but international trade was influenced only in so far as there was a peculiar — a comparative — advantage in some among her indus- tries; that is, in so far as United States used capital better in some directions than in others. England also used tools and machines with large effect, even tho not with all-around effect as great as the United States. In England, however, the other side of the capital factor entered, giving a comparative advantage in certain direc- tions; namely, the return which had to be paid in the way of interest on the needed capital was lower. So far as all of her industries shared in the lower interest rate alike, no influence of international trade could emerge. But so far as the technical development of a particular industry called for large capital —a large amount of previous labor allied with a moderate amount of current labor — the lower return on the capital embodying the previous labor gave that industry a comparative advantage. The iron industry was typical: larger plant, larger outlay for materials, comparatively small current-labor account. Here a low interest charge had a greater effect on prices, and thru prices a greater effect on international trade, than in industries where capital charge was a less important item. The United States, on the other hand, at this later stage, had an advantage in those industries when the use of tools and implements made the effective- ness of labor especially great. England had an advantage in those industries where much capital was used and where the lower interest rate enabled the commodities to be put on the market at a price especially low. This contrast, noticeable in the last third of the 19th century, tended to diminish in the era which opened with the 20th century.

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