Globalisation Essay (Economics

Global Essay Why do nations trade? Outline changes to world trade as a result of globalisation. Discuss any justifications for restricting trade. Various nations participate in world trade for a variety of reasons. Three major factors which motivate nations to trade are factor endowments, absolute advantage and comparative advantage. There are also many other benefits, which can be gained from world trade. These include increased production resulting in increased GDP and higher rates of economic …

…have the ability to be self-sufficient in the event of a war or similar event. By participating in world trade, countries can have a number of benefits including increased production, higher levels of economic growth, higher incomes and can also achieve a higher standard of living. Although taking part in world trade can provide many benefits, governments still choose to restrict trade in order to protect their own domestic producers from too much foreign competition.