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In many respects international trade is no different from trade within a country. People who have more of a good than they want seek out other people who have something they lack. Through exchange, both parties attempt to make themselves better off. The complications of international trade arise because the two parties use different monies. An American who wants to buy a Japanese automobile cannot expect the Japanese manufacturer to accept U S. dollars in payment, unless by sheer coincidence the manufacturer happens at the time to want to buy a new computer from an American firm Otherwise the auto manufacturer will be stuck with money that no tempura shop or geisha in Tokyo will accept; in Japan the dollars are useless. |
