THE INTERNATIONAL ECONOMY
The international economy is very important, because emphasize in the problem of the economy betweencountries. The study of the international economy is based on seven topics: gains from trade, trade patterns, protectionism, balance of payments, determining the exchange rate, international coordination ofpolices and the international capital market.
Each and one of these topics had a significant job for the international economy, the production and gives to the countries de large-scales in theirproduction. Obviously the trade patterns examines the interaction of the natural resources like land, labor and capital and the use of these factors on their productions.
The protectionism as we know isthe economic policy of restraining trade between states, through methods such as tariffs on imported goods, restrictive quotas, and a variety of other restrictive government regulations designed todiscourage imports, and prevent foreign take-over of local markets. Thanks to the protectionism the international economy has survived, because it analyzes effects on the politics that the countries useto protect their market.
Another topic that is mentioned in the book is the balance of payments, this point is very important to have a certain balance in the economy of a country, in this balance thecountries can see de transactions that they have and analyze if they are in deficit o have a surplus, which mean that if they have a deficit in their balance is a really bad, because we can see thattheir economy is no going so well, but the surplus is considerably bad because is enter money but that money it isn´t flowing in the country. And for that they can determined the exchange rate, becausethere is money that doesn’t count, and that’s why are currencies that have some more value than others like de euro and the Mexican peso.
The international coordination of policies emphasis that...