Black Sea Scientific Journal Of Academic Research

THE IMPORTANCE OF TRADE: AN ECONOMICAL AND HISTORICAL OVERVIEW

Miriam Massy^* Department of Economics, Cairo University, Cairo, Egypt
^*Correspondence: Miriam Massy, Department of Economics, Cairo University, Cairo, Egypt, Email:

Received: May 11, 2023, Manuscript No. BSSJAR-23-98437; Editor assigned: May 15, 2023, Pre QC No. BSSJAR-23-98437(PQ`); Reviewed: May 29, 2023, QC No. BSSJAR-23-98437; Revised: Jun 05, 2023, Manuscript No. BSSJAR-23-98437(R); Published: Jun 12, 2023, DOI: 10.36962/GBSSJAR/60.2.003

About the Study

The movement of commodities and services from one person or entity to another, frequently in return for money, is referred to as trade. Economists define a market as a structure or network that permits commerce. Barter was an early type of commerce that involved the direct exchange of products and services for other goods and services, trading without the use of money. Modern merchants often bargain using a means of exchange, such as money. As a result, purchasing may be distinguished from selling or earning. Money's creation substantially facilitated and promoted commerce. Bilateral trade is trade between two dealers, whereas multilateral commerce involves more than two traders. According to one current viewpoint, commerce arises as a result of specialisation and the division of labour, a prevalent kind of economic activity in which people and groups focus on a specific component of production but utilise their output in trades for other items and requirements. Trade happens between areas because various locations may have a perceived or real comparative advantage in the production of some tradeable item, such as natural resources that are rare or limited elsewhere. For example, the size of various locations may stimulate mass manufacturing. In such cases, commerce at market pricing across areas can benefit both. Various sorts of traders may specialise in trading various types of items.

Retail trade is the sale of products or items in small or individual quantities from a permanent location such as a department store, boutique, or kiosk, online or by mail, for direct consumption or use by the customer. Wholesale trade refers to the sale of items as merchandise to retailers, industrial, commercial, institutional or other professional business customers or other wholesalers and related subsidiary services.

Perspectives

There are several types of communicable diseases caused by different pathogens, including viruses, bacteria, fungi, and protozoa. Trade is a crucial aspect of economic development and globalization. It allows countries to specialize in producing goods and services that they have a comparative advantage in and then exchange them with other countries. This leads to increased efficiency, lower costs and higher consumer welfare. However, trade can also lead to job losses and income inequality in certain sectors and regions. Some argue that free trade agreements exacerbate these negative effects and benefit only large corporations, while others believe that they promote economic growth and development. Overall, trade is a complex issue with different perspectives, and its impacts depend on many factors such as the level of development, the type of industry, and the policy framework. There are two types; protectionism and development of money.

Protectionism: Protectionism is the policy of restricting and discouraging commerce between states, as opposed to free trade. Tariffs and quotas are frequently used to implement this strategy. Between the Great Depression and the outbreak of World War II, protectionist measures were especially widespread.

Development of money: Money's first manifestations were items with inherent worth. Commodity money refers to any readily available commodity with intrinsic worth; historical examples include pigs, unique seashells, whale's tooth, and cattle. Bread was utilised as an early form of money in mediaeval Iraq. Under the leadership of Montezuma, cocoa beans were legal tender in the Aztec Empire. Currency was created as a uniform form of money to enable the trade of goods and services. For almost 1500 years, the Fertile Crescent's trade was based on this initial stage of money, in which metals were employed to symbolise stored value and symbols to signify goods. Coins from the first large-scale cultures are known to numismatists, however they were initially unmarked lumps of precious metal.