🌍 International Trade Theory & Its Outcomes

📘 International trade theory (like Comparative Advantage, Heckscher-Ohlin, etc.) explains how countries benefit from engaging in global trade.

🎯 The primary outcomes promoted by international trade include:

📈 (1) Increase in demand for exportable products

Countries specialize in goods where they have a comparative advantage, leading to higher production and global demand for such exports.

💹 (2) Fall in prices and Rise in volumes

While volumes may rise due to increased trade, prices often fall, due to greater competition and economies of scale.

🏭 (3) Improvement in quality of products

Global competition forces firms to improve the quality of their products to remain competitive in international markets.

🛒 (4) Reduction in prices and increase in quality for consumers

Trade introduces price competition and greater product variety, allowing consumers access to better products at lower prices.