{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

7 - process From these the mercantilist sentiments of...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Chapter 6 -- International Trade This chapter traces the history of International Trade Theory back over 500 years to Mercantilism in Europe's colonization period. In those days European powers such as England, France, the Netherlands, Spain and Italy would economically enslave colonies with total market imperfections, disallowing the development of local industry, taking what they needed back home ... perhaps turning what the took into higher value products and selling them to the same colonies. Their whole purpose was to maximize their holdings of treasure by encouraging exports and discouraging imports (imports they had to pay for). From there, trade theory evolved through absolute and comparative advantage over the next couple hundred years. Each country-based theory tried to fix flaws with the prior theory and added a little more understanding to the
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: process. From these, the mercantilist sentiments of protectionism have survived as neo-mercantilism. Newer trade theories have continued to tap comparative advantage, adding returns to specialization, economies of scale, and more. From the International Product Life Cycle to New Trade Theory, focus eventually moved to the firm from the country level. The chapter ends with a fusion theory that blends country-based and firm-based theories to explain why certain areas of certain countries are solid global competitors in certain industries. This is the Porter Diamond theory of national competitiveness. We explore the Diamond and Dunning's extension to it with the inclusion of activities of multinational enterprises....
View Full Document

{[ snackBarMessage ]}

Ask a homework question - tutors are online