The Role of Trade

The Role of Trade

The importance of trade springs from the extensive degree of specialization of observed in our society. Even in the most primitive societies people cooperate in the use of their scarce resources, because through such cooperation more goods and strives are produced than if everyone tried to do many different jobs at once.trade

          The high degree of specialization in our society increase the standard of living of all by making more goods and service available. But specializations   necessarily implies trade and cannot occur without it. This follow from the fact that people usually have a "balanced diet".trade The specialized producer use only a one part- may be none- of his won product for his personal consumptions, and he exchange his surplus for the goods and service of others specialized producers. For instance, a shoemaker dose not and cannot consumes only shoes. He needs, in addition, food, clothing, shelter, transportation, and so on.trade Therefore, he ex-change his surplus production of shoes (which for practices purposes, may be identified with his total output of shoes) for the specialized outputs of farmers , supermarkets, auto producers, physicians, tailors, and the like. Such exchange of goods and services among resident. trade