The Trade Theories Of International Business - 1500 Words

According to Daniels, Radebaugh and Sullivan (2015) â€Å"International business is defined as all commercial transactions, including sales, investments, and transportation, that take place between two or more countries† It is the exchange of goods and services among individuals in multiple countries. There are some of the trade theories that influence competitive advantages. One of the theories is the Absolute advantage theory, which states that some countries produce some goods more efficiently than others. By being good at one thing a country can gain competitive advantage as a whole. A country can have a natural advantage, which comes from creating a product or service from climatic conditions, access to certain natural resources, or availability of certain labor forces. Another theory is the Mercantilism theory states that a country’s wealth is measured by its holdings of treasures, which usually means its gold. The theory goes on by saying that a country should ex port more than they import and, if successful, receive gold from countries that run deficits. (Daniels, Radebaugh and Sullivan, 2015) Discuss the factors that increase globalization There are many factors that increase globalization. One factor that I believe plays the biggestrole is an increase in application technology. Technology has advanced tremendously over the last couple of years. Making a phone call hasn’t been easier than it is now. You can reach anyone at anytime on their cellphone, and callingShow MoreRelatedWhy Do Business Internationalise?. International Trade1181 Words   |  5 PagesWhy do business internationalise? International trade can be traced back to ancient years. Our ancestors, with the purpose of increasing the variety of local products, had been trying their best for decades to trade cross border. 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The author will examine and critically assess the concept of international trade. This paper agrees with the economist that international trade is the interdependence of nations in terms of trade, cultural diffusion, and economic interdependency. International business trade theories are basically different theories with their concept of trade how they explain international trade. The concept of majority of economist believe that, trade is about exchanging