The global economy: it's a small world after all

Abstract: To understand why people trade, suppose you were limited to consuming only items you could find within walking distance of your house. Or, perhaps even worse, only items you could produce yourself. For most of us, this restriction would severely diminish the variety of goods and services we enjoy on a daily basis. Therefore, the simplest answer to the question is that people (or entire countries) trade because they will enjoy a wider variety of goods.

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Bibliographic Information

Provider: Federal Reserve Bank of St. Louis

Part of Series: Page One Economics Newsletter

Publication Date: 2013-Nov

Pages: 1-3