In government economic policy: Experience in selected countries. This was the so-called availability theory of credit; it held that monetary policy had its effect on spending not only directly through interest rates but also by restricting the general availability of credit and liquid funds.

Paul Samuelson’s critique argues that when a rich country enters into a free trade agreement with a poor country, there will be a dynamic gain in the efficiency with which resources are used in the poor country. The poor country’s productivity will improve rapidly. 60.

What did Paul Samuelson point to as his biggest concern with free trade and its possible affects on middle-class wages in the United States? the United States. Photocopiers were initially exported from the United States.

Abstract. Linder’s theory of overlapping demands suggests that international trade in manufactured goods will be stronger between countries with similar per capita income levels.

The theory of country size holds that large countries tend to be more self-sufficient than smaller ones because of varied climatic conditions (resulting in the production of a wide variety of agricultural products) and more natural resources.

Production may shift to the developing countries. On costs and revenues: Low production costs and a high demand ensures a longer product life. When production costs are high and demand is low, it is not offered on the market for a long time and, eventually, is withdrawn from the market in the ”decline” stage.

The aim of Trade Theory is to explain the existing patterns of trade, the impact on the domestic economy, and the type of public policies that should be introduced to increase a country’s well-being.