National Incomes and International Trade [antikvár]

The aim of this investigation is to establish in quantitative terms therelation between the foreign trade and the level of domestic economicactivities of the various countries participating in international exchange.This objective entails two complementary questions: first, how fluctuationsin the level of domestic economic activities affect a country's imports andexports, and thus its balance of trade and concomitant capital movements;and second, what conditions must be fulfilled by a country's internationaleconomic activities (imports, exports, capital movements) in order to as-sure a certain level of the domestic economy.In the last decade or so, various statistical and theoretical investigationsof the relation between national income and foreign trade have been under-taken in connection with the foreign-trade multiplier theory. Such studies,however, have necessarily been limited to an analysis of a single country:imports have been related to the given country's level of income, and ex-ports have been regarded as given data, in the context of the theory. Withthis type of analysis there is no way of establishing a connection betweenthe trade and income of one country and the trade and income of any other.The present analysis, on the other hand, includes the determinants of ex-ports, as well as of imports, operating on the premise that a country'sexports depend primarily upon the incomes of the other countries. It hasthus been possible to establish a system of interrelationships among allthe countries involved in international trade, a system in which both im-ports and exports appear as governed by the level of domestic economicactivities, particularly by income or a similar magnitude. The applicationof this model to the second question formulated above proved theoreticallysimple, though statistically difficult.The period covered by the present study is, roughly, the years betweenworld wars I and II. For practical reasons, both economic and statisticalin nature, most of the analyses could not be undertaken for the years beforethe mid-twenties, and had to be terminated before 1939. In general, how-ever, the study can be regarded as referring to the structure of the worldeconomy in the interwar period.The relationship that we aim to estimatebetween foreign trade andthe level of domestic economic activitiesdepends on the specific structureof the world economy. The term "structure" is used here in an all-embracingsense, covering the quantity, quality, and distribution of all availableeconomic resources, and taking into account the various territorial divisions