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InterantionalTradeTheoryandPolicy InformationSites http www wto org InternationalTradeStatisticsCompiledandanalyzedbytheWTO seconomistsandstatisticians thefiguresprovidecomprehensive comparableandup to datestatisticsontradeinmerchandiseandcommercialservicesforanassessmentofworldtradeflowsbycountry regionandmainproductgroupsorservicecategories Chapter1 Introduction WhatisITAbout ItsroleinthesystematizationofEconomicsWhatdoesITstudy ThegainfromtradeThepatternoftradePolicychoice BalancebetweenfreetradeandprotectionismTheframeworkoftheIT ItsroleinthesystematizationofEconomics EC Microeconomics Macroeconomics InternationalTrade InternationalEconomics InternationalFinance Thegainfromtrade Whencountriessellgoodsandservicestooneanother thisisalmostalwaystotheirmutualbenefit thatistosay therearegainsfromthetrade Thepatternoftrade Cloth IT Toy Machine Oil Tech Tulip Soybean Policychoice TheFrameworkofIT FundamentalKnowledgeofIT ConceptionMeasurementVolume ValueTradeBalanceTermsofTradeDependenceDegreeofTradeClassify Conception InternationalTrade fromthepointofviewofworld Foreigntrade fromthepointofviewofsinglecountry ExportandImportTradingPartner ExportandImport Importsaregoodsandservicespurchasedfromforeignsources TheU S importsover 1trillionworthofgoodsandservices Totalimportsrepresent12 oftotalGDP Exportsaregoodsandservicessoldtoforeignbuyers Exportswerejustunder 700billionin2000 Exportsaccountforabout11 oftotaloutput ExportsinRelationtoGDP ExternalTradePerformanceinChina 1978 2002 Sources StatisticalYearbookofChina variousissues TradingPartner MerchandisetradepartneroftheU S byregionandeconomy 2000 Volume Value PriceIndexP0Q1 P1Q1 P1 P0 Balanceoftrade X M Importsandexportsareseldomequal Thetradebalanceisthedifferencebetweenexportsandimports X ExportM ImportFavorablebalance Surplus X M 0Tradesurplus theamountbywhichthevalueofexportsexceedsthevalueofimportsinagiventimeperiod Balanceoftrade X M Unfavorablebalance Deficit X M 0Tradedeficit theamountbywhichthevalueofimportsexceedsthevalueofexportsinagiventimeperiodAnyimbalanceintradeintheworldmustbeoffsetbyreversebalanceselsewhereintheworld State China USA TradeBalancesofUS TheU S typicallyhasmerchandisedeficit aservicessurplus andanoveralltradedeficit BilateralTradeBalancesTopDeficitCountries BilateralTradeBalancesTopSurplusCountries Termsoftrade Termsoftradeistheratioofacountry sexportprice Px toitsimportprice Pm TOT TherateatwhichgoodsareexchangedTheamountofgoodAgivenupforgoodBintrade Changesintermsoftrade Animprovement ordeterioration inthetermsoftradereflectsanincrease decrease intheper unitgainfromtrade Itmeasurestheamountofimportthatacountrycanexchangewithaunitofitsexport Termsoftradeindex Thetermsoftradeindexistheratiooftheunitvalueindexfortotalexportstotheunitvalueindexforimports measuredinthesamebaseperiod TheIndexoftheTermsofTrade 1Betteroff 1nochange 1Worseoff DependenceDegreeofTrade Conception China World Thinking whichconditionisbetterforacountry bigorsmall China sDependenceDegreeofTrade ClassifyofIT AccordingtothenaturalcharacterTangibleTrade MerchandiseTrade IntangibleTrade CommercialServicesTrade AccordingtothedirectionExport ImportTransitTrade ClassifyofIT AccordingtothethirdpartyDirectTrade IndirectTradeEntreport ReimportAccordingtotheFrontierGeneralTrade SpecialTrade VolumeofWorldMerchandiseTrade1993 2000 change ExportsandImportsSource WTO InternationalTradeStatistics 2001 CommercialServicesTrade Conceptioncross bordersupply Transportationconsumptionabroad Tripcommercialpresence BankFiliationsmovementofpersonnel BuildingContraction WorldTradeinServices1993 2000 changeinvalue ExportsandImportsSource WTO InternationalTradeStatistics 2001 ProducingArea China HongKong ConsumerArea USA ExportTrade EntreportTrade ImportTrade TransitTrade Directtrade Indirecttrade GeneralTrade SpecialTrade OtherClassifications foreignexchangetrade bartertradeBilateraltrade MultilateraltradeDocumentaryTrade EDI

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