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How has globalization impacted international trade theories?

Kathey Sudddard

Hey!

Globalization has had a significant impact on international trade theories. This is because the concept of globalization has changed the way countries do business with each other.

One of the most significant impacts of globalization on international trade theory has been the shift from protectionism to free trade. Protectionism was a theory that advocated for the protection of a country's domestic industries through tariffs and other trade barriers. However, with globalization, countries have realized the benefits of free trade, and there has been a decrease in protectionism.

Another impact of globalization on international trade theory has been the rise of multinational corporations. These corporations have become major players in international trade, and they operate across borders and with different cultures. Multinational corporations have allowed countries to tap into global markets, thereby increasing the potential for international trade.

Globalization has also led to a more significant role for technology in international trade. Technology has made it easier for countries to connect and do business with each other, and this has led to an increase in international trade. The rise of e-commerce has made it possible for small and medium-sized businesses to access international markets, thereby increasing the potential for international trade.

Overall, globalization has had a significant impact on international trade theories. The shift from protectionism to free trade, the rise of multinational corporations, and the role of technology in international trade are just some of the ways globalization has changed the way countries do business with each other.