According to Philip Curtin, trade and exchange represent “the most important external stimuli to change.” Using France as your point of reference, assess this argument. In doing so, be certain to support your analysis with specific evidence
Trade And Exchange
Many countries benefit from trade and exchange both locally and internationally. International trade however is much beneficial as it has a lot of advantages in opening up a country to many changes which can be both positive and negative. International trade has impacted so many countries as they are able to think outside the box and perform better than they were before. France in this case is not left behind. Trade and exchange in France has led to a lot of changes ant thus below is the justification of the statement, trade & change represent “the most important external stimuli to change.”
The exportation of goods in France has led to the development of the industries. This is shown when it is said that although Ottoman’s shares of the processed textile goods decreased, study shows that during that period, there was a market tendency to proto-industrial development. It also led to the opening of the rural settlement areas where factories were distributed to the areas and the people employed (Edhem,2012).
The trade in France helped to increase the overall national income of the country and facilitated savings and opening of new channels of investment in the country. Many people were able to come in and make investments in the country which opened it up. The increased savings and investment helped the country grow economically.
It was able to acquire capital goods from the developed countries especially in Europe. They were thus able to acquire the heavy engineering machines which were able to foster the country’s economic development.
They were also able to import skills from other countries. The country at that time was short of some professionals such as the doctors, managers, engineers, economists and other technical personnel. To cater for this shortage, they were able to get some of their skilled persons from the European countries in most cases.
The foreign trade in the country was also able to extend the scope of the business to the international market. France’s domestic market was limited and thus the foreign trade sector was able to open new markets and marketing channels. When the market was extended, the economy of scale was reaped and productivity and efficiency increased (Verdier, & O’Rourke, 1994). The forces of development thus set themselves in motion.
France was also able to attract foreign investment who invested in the form of technical expertise and capital goods. France was thus able to find the latest technologies, the assembling plants and the manufacturing plants as well making their way into the country. This thus promoted trade and industries in the country (Edhem, 2012).
The trade from the imports and exports enabled the government by then to get sufficient revenues. This came from the custom duties, tariffs, and the import license fee as well. This enabled the government to set up investments so as to steer up development in the country(Verdier, & O’Rourke, 1994).This was supplemented by the foreign exchange earnings from the goods and services being imported or exported. This external sector also opened the employment opportunities for the local people to work in the foreign countries.
The trade between France and other countries led to the country gaining global competitiveness which made the domestic businesses to increase in efficiency as they were exposed to international competition. This integration with the world economy made the business persons to have an easy access to the technological innovations. This also helped them to make improvements on their local products so as to keep up with the world’s quality.
At that time, France was well known for the export of textile products. This is very labour intensive and thus earn very high tax when imported. This makes them goods of high value and thus are able to earn the country sufficient foreign exchange to aid in development (Edhem, 2012).
France is not a closed economy. It participated in international trade with several countries for different types of goods. This thus led to a reduction in the poverty line by a very big margin. This international trade brought about the generation of the financial resources(Verdier,& O’Rourke, 1994). The government was thus able to set up the health care and educational facilities to the poor in the country. This gradually reduced the poverty line.
The unemployment rate also decreased leading to a contribution in the reduction of the poverty line. This was in line with the rise in the demand of the domestic goods and thus their resources were fully utilized. This rate of the development in the country reduced the poverty level.
France also excluded all the trade barriers on their agricultural products. This led to the rise and decline in the world prices and the production respectively. This led to them exporting their agricultural products at escalated market price and thus made a very great profit(Butel, 1990). This made the farmers very prosperous and thus inspired the spirit of development inside them.
France has benefited greatly from the dissemination of knowledge from the countries that were better off at that time. They were able to learn new skills and knowledge of the various things going on in their partner countries while undertaking trade and exchange. It also created interdependence between France and its partner countries. It created economic interest between the countries and thus became economically dependent on each other(Butel, 1990).
The trade and exchange also led to an increase in the productivity of capital, labour and organization. The demand on this made them to become mobile both on the national as well as the international level. This helped the country to develop rapidly and thus develop and high level of growth.
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