Zosymova Zhanna

Ph.D. in Economics, Senior Lecturer

Department of International Economics

Kharkiv State University of Food Technology and Trade

bilyabock@mail.ru

THE BASIC THEORY OF FOREIGN TRADE ACTIVITIES

Protectionism hampers international trade, creating advantages for individual countries, especially metropolises, shielding barriers colonial territories. In such circumstances, international trade was divided into domination of the metropolitan area. However, the prerequisites for sustainable imbalance in foreign trade relations, their disadvantage for one of the parties involved. There were serious obstacles to the development of capitalist relations, determines the expansion of foreign trade exchange and the division of the world market. Protectionism inhibited these processes. Mercantilist approach in this situation lose their positions, giving way to a theory based on the principle of free trade. But nowadays there are variants of neo-mercantilist trade policy in individual countries, which are resorting to some extent to protectionism, guided by the trade surplus, boosting exports and restraining imports on certain types of goods and services, individual sectors and industries.

In his economic views classics of English political economy. Adam Smith, David Ricardo and DS Mill advocates of "comparative advantage theory" came out of the scope of determining the value of production, which creates the wealth of nations, providing them with the purchase of goods and services available. At the same time, they believed that the possibility of producing favorable conditions for its implementation are determined by natural, natural factors. The advantages of these factors and determine the management of a production, including for export goods abroad. The approach from the standpoint of "natural division of labor" and inherent in many modern followers of the classics[1-3].

The principle of freedom of trade allows a country, according to A. Smith, to focus its efforts on the production of those products, which it can do better and more cheaply. Formed as a result the division of labor is the growth of exchange, international trade brings benefits to the participants. At the same time, according to A. Smith, such benefits are determined by the difference in the absolute costs of production (number of persons required for the manufacture of Unit) in each country. For example, wine in France and Portugal are cheaper than in Scotland. In these circumstances, it would be folly to produce wine in Scotland with the help of greenhouses, where a lot cheaper to bring it from Portugal or France.

The refusal of the production of those goods for which the country has an absolute advantage, and the concentration on the product, which has such advantages lead to an increase in overall production volumes, an increase in the exchange of the results of labor. Provisions A. Smith get even greater development, if taken into account not only natural, but also gained the benefits associated with the use of new technologies, which refers to the finished product, component of the overwhelming majority of the international trade. Known convention approach to "absolute advantage theory" associated with the consideration of a pair of countries, commodity option directly rather than monetary exchange. But the introduction of these realities, ceteris paribus, does not alter the main conclusions. [1]

According to E. Heckscher and B. Olin, a comparative assessment of factors determines three essential factors:

-in countries participating in the international exchange tended to be removal of those goods and services for the manufacture of which are used primarily the factors of production are available in abundance, and, conversely, to the importation of the products for which there is no shortage of factors;

-development of international trade leads to equalization "factor" price, ie income received by the owner of this factor;

-with sufficient international mobility of factors of production it is possible to replace the export of goods moving between the countries themselves factors.

Finally, the ability to proclaim the country to increase the production of goods, attracting more factors present in excess. Therefore, in the exporting country such factors will be used on an increasing scale by increasing factor prices due to declining marginal utility of each new factor. On the other hand, the importer factor prices will fall under the influence of replacing the need for factor import of the relevant goods and services.

Вibliography

1. Калинчик Н.В., Алексеенко И.Н. Направления стабильного развития зернового хазяйства Украины: Монография. – К.: ННЦ ИАЭ, 2012. – 250 с.

2. Кузьмін О.Є., Пирог О.В. Секторна модель розвитку національного господарства України в умовах постіндустріального суспільства // Бізнес Інформ.– 2013.– №7. – C. 8–13.