338 INTERNATIONAL TRADE 
precisely in what way do these results, similar tho we expect them 
to be, come about where the machinery in operation is dissimilar ? 
and may there not be important substantive differences because 
of the fact of altered machinery ? 
One or two matters of phraseology may first be disposed of. 
I shall use “exchange” and “foreign exchange” when referring 
to bills of exchange and the prices at which the bills sell. Unfor- 
tunately we have not in English any term which is always and solely 
used to designate these things, like the German Devisen or the 
French change. The term “foreign exchange,” which might 
readily be supposed to refer to the exchanges of goods between 
countries, 2.e. to the substance of international trade, must be 
used, somewhat clumsily, when we discuss bills of exchange and 
the prices at which they sell in terms of another country’s money. 
On the other hand, following the usage already familiar to the 
reader, I shall speak of the “terms of trade” or the “barter terms of 
trade” when referring to the substance of the trade between coun- 
tries — to the physical volume of goods that go from one to 
another. 
Further, I shall speak of “paper exchange” and “specie ex- 
change,” of “paper conditions” and “specie conditions,” indicating 
by these phrases whether the trade takes place under a mone- 
tary standard which is the same in the trading countries or under 
different standards. There may of course be specie conditions 
which are not the same in the two countries — gold in one, silver 
in another; then the case becomes analogous to that of paper 
conditions and paper exchange. A general term for describing the 
conditions dealt with in the present chapter is “dislocated ex- 
changes.” Where the same money is used in the several countries 
— gold, as in the cases considered in the first two Parts of this 
book — we have connected exchanges. What we are now to 
consider is international trade under dislocated exchanges. 
The older writers assumed that the main currents of international 
trade were not affected by the substitution of paper money for 
metallic, or by the circumstance that the trading countries might 
not have the same metallic standard. Differences between the