International trade is one of the fundamental contributors to globalization which suggests the promotion of international relations with respect to trade, political relations and citizen well being. A world economy is created from such trade where the market forces of demand and supply reign. One would be tempted to ask for a country that sees itself as self sufficient, is international trade really necessary? Like in the case of Rodamia, the answer perhaps can be derived from a critical evaluation of the advantages and disadvantages accruing to a country contemplating such a step.
Write a 1,050- to 1,250-word report advising the President of Rodamia making recommendations for international trade. Address the following:
• List at least one advantage and one limitation of international trade you encountered in the simulation.
• Define absolute and comparative advantage in your own words.
• Explain how absolute and comparative advantages were used in your simulation.
• Describe the influences affecting foreign exchange rates.
• As with all academic papers, be sure to include your references in your paper.
international trade has been present throughout much of history its economic, social, and political importance has been on the rise in recent centuries.
Industrialization, advanced in technology transportation, globalization, multinational corporations, and outsourcing are all having a major impact on the international trade system....
Developed nations trumpet the claim that the answer to developing nations’ international trade issues is untrammeled or open market activity as opposed to government intervention by developed nations’ governments.
Marxists and Neo-Marxists, although in decline politically, continue to present powerful theoretical arguments that have an appeal in the peripheries of the world. They view international relations primarily in terms of class conflict within and among nations and argue that since the 16th century, capitalism has increasingly incorporated the peripheries into a world system of domination and exploitation through imperialism, colonialism, and neo-colonialism (Wallerstein 1974; Schiller 1981, 1985). The social revolutions in Russia, China, Cuba, Vietnam, and many less developed countries (LDCs) have attempted to break away from the fetters of the world capitalist system. However, they are being reincorporated by an international regime orchestrated by the transnational corporations, the World Bank, the International Monetary Fund, the General Agreement on Tariffs and Trade (GATT), and its successor, the newly formed World Trade Organization (WTO). But, Marxists further argue, internal contradictions, wars, and revolutionary struggles will continue to challenge the dominant capitalist system. For Marxists, equality is the primary normative value while historical materialism and dialectics are the dominant methodologies.
By specializing in production, and by trading with other countries, it is possible for countries to increase their incomes. Even though countries as a whole benefit from specialization and international trade, all groups in society, workers and capitalists, do not gain according to the Heckscher-Ohlin theory. If international trade leads a country to specialize in producing goods that require lots of workers and little capital, such a specialization increases wages (which benefits the workers) but decreases the income of the capital owners. But the country as a whole benefits because the gain of the workers is bigger than the loss of the capital owners.
The Trade Ruler game is set in “the Hechscher-Ohlin world” you are to make an island (a country) prosper by trading. As a ruler of an island you want to engage in international trade to achieve this goal” (Nobel Media, 2011).
International trade and globalization have been considered a good omen in the past but with changing world conditions such as the debt crisis, child labor issues, growth inequality issues hands are being raised at the benefits of world/international trading.
Liberals, by contrast, have pointed to the integrating forces of the world market as a new reality creating considerable international interdependency in the postwar period. They have argued that increasing levels of free trade, development, deepening and broadening of interdependency, and international cooperation through intergovernmental organizations are the surest path to peace (Keohane & Nye 1989). For liberals, freedom in property ownership, politics, and trade is the primary normative value. In their studies of international relations, Liberals supplement historical analysis with a variety of quantitative and qualitative methods such as time-series, correlation analyses, and simulation games.
It is what enables us have freedom to choose between similar products from different origins depending on quality or branding, it is what enables consumers to choose products that are close substitutes but almost entirely different in constitution and manufacture processes according to taste and personal preferences, it is what makes Brazil famous for coffee and Japan famous for cheap and energy efficient low consumption cars, it is what makes German cars stylish and French champagne exotic, it is what makes Kenyan tea rank high in world prices and Middle Eastern oil receive such a huge slice of many countries’ import allocation-International trade. Put simply, it is trade between countries involving exchange of goods and services and this paper with aid of the simulation provided seeks to look in the dynamics surrounding international trade.
Thus, the effects of global communication on the evolution of international relations theory and its underlying international system have been two-fold. On the one hand, global communication has empowered the peripheries of power to progressively engage in the international discourse on the aims and methods of the international system. In this way, Liberalism challenged the traditional state-centered, protectionist, mercantilist policies of the 16th to 18th centuries with its revolutionary doctrines of laissez-faire in international trade and protection of property and liberty in domestic life. However, it also incorporated much of the geopolitical Realist view of power politics in its justification of the colonial and imperial orders while increasingly emphasizing the role of IGOs in the management of the international system. Similarly, Marxism challenged Liberalism's dominance in the 19th and 20th centuries by its mobilization of the peripheries against the colonialist and imperialist orders. However, in practice, Communist regimes often cynically followed Realist geopolitical doctrines in favor of international proletarian solidarity. Liberalism, in turn, undermined the Communist regimes by its control of the main world capital, of trade, and of news flows through appeals to democratic values. In a world system dominated by state and corporate bureaucracies, Communitarianism is the latest phase in a continuing theoretical and ideological struggle by the peripheries to put the human rights of the oppressed on the international agenda. In its preoccupation with the collective rights of community, however, Communitarianism cannot altogether ignore the Realist focus on political order, the Liberal preoccupation with individual freedom, and the Marxist concern with social equality. Postmodernism deconstructs the truth claims of all of the foregoing schools by casting doubt on their meta-narratives. But it also posits its own meta-narrative of relativism as a truth claim. Tensions among the five theoretical schools clearly reveal the tensions among the competing aims of democracy: order, freedom, equality, community, and identity.