Principles of International Economics

Prof. Dr. Hans H. Bass, Bremen University of Applied Sciences, International Degree Programme in Economics

Summer Term 2010

Principles of International Economics

Topic 2: International Trade – Basic Facts

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1. International Trade in Commodities2. International Trade in Services

AgendaInternational Economics

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Merchandise Trade 1970-2008

International Trade

0

100

200

300

400

500

1970 1975 1980 1985 1990 1995 2000 2005

Exports of agricultural products Exports of fuels and mining products Exports of manufactures

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growth rate merchandise trade > growth rate world production(annual average percentage change)

.

CharacteristicsInternational Economics

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Source: WTO, ITS 2009

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different periods, but always: growth rate merchandise trade > growth rate GDP

different spatial growth patterns: “Triade”, EA-NICs, RoW

CharacteristicsInternational trade in commodities

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UN Comtradehttp://comtrade.un.org/db/dqQuickQuery.aspx

Data sourcesInternational trade in commodities

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CAGR (t0, t1) = ((Yt0/Yt1) (1/(t1-t0)) – 1)*100, where t0 indicates the starting period, and t1 indicates the end period, while Y indicates the Variable

CAGRInternational trade in commodities

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1. International Trade in Commodities2. International Trade in Services

AgendaInternational Economics

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TrendsInternational trade in services

0

100

200

300

400

500

600

700

1980 1983 1986 1989 1992 1995 1998 2001 2004

Dienstleistungen IDX Agrarprodukte IDX

Brennstoffe/Bergbau IDX Fertigwaren IDX

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0

10

20

30

40

50

60

70

80

90

100

1800 1850 1900 1950 2000

Bes

chäf

tigte

nant

eil i

n %

Background: Fourastié Hypothesis

International trade in services

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higher income elasticity of demand for personal services vis-à-vis commodities

technical changes in business-related products: “compacks”

Reasons for an increase in trade in services

International trade in services