In: Economics
“In 2014, “the United
States exported $2.34 trillion worth of goods and services—an
all-time record. Exports from the United States in 2014 equaled the
entire gross domestic product of Brazil and exceeded all commercial
output in India, Italy, or Mexico. What is more, exports are an
increasingly important aspect of the U.S. economy.” (New top
markets series provides data, 2015)
In your thread, complete the following:
Discuss economic theory related to the quote above. Be sure to include a definition of exports and the way in which exports are counted in the measurement of Gross Domestic Product (GDP) within your discussion.
Locate and incorporate outside research that gives evidence and explanation as to the possible causes of this growth in exports. Provide an example of 1 particular industry or country with which export quantity has increased.
Integrate biblical insights into your thread. In what way does Scripture influence our attitudes and actions in international trade? 300 word min
Answer: The term export means sending of goods or services produced in one country to another country. The seller of such goods and services is referred to as an exporter; the foreign buyer is referred to as an importer. Export of goods often requires involvement of customs authorities. An export's counterpart is an import.
Economic theory related to the quote above is export based where exports play an important role in the US economy, influencing the level of economic growth, employment and the balance of payments. In the post-war period, lower transport costs, globalisation, economies of scale and reduced tariff barriers have all helped exports become a bigger share of national income.
Causes of growth of export
Exports are counted in the measurement of Gross Domestic Product (GDP) where Exports (X) represents gross exports. GDP captures the amount a country produces, including goods and services produced for other nations' consumption, therefore exports are added. Note that C, G, and I are expenditures on final goods and services; expenditures on intermediate goods and services do not count. GDP is important because it gives a bird's-eye view of how an economy is doing. If GDP speeds up, it can be a sign that good things are happening or are about to happen in a number of areas — people getting more jobs or better pay, for example, or businesses feeling confident enough to invest more.
Example of a particular industry or country with which export quantity has increased is US, UK and many more. On April 12, the US Department of Commerce announced that US exports of goods and services in February 2012 topped $181 billion, a new monthly record. Exports in 2011 reached $2.1 trillion, eclipsing the previous annual record set in 2008 by nearly $300 billion. Since the Great Recession ended, exports have accounted for half of US economic growth * --about four times exports’ weight in the economy-- and clearly been one of the bright spots in a rather cloudy economic picture. Externally, the global (ex-US) economy is growing faster than at home, which stimulates exports. Moreover, the US is a globally competitive supplier of many of the goods and services needed by rapidly developing economies—ranging from food and pharmaceuticals to aircraft and professional services. So the overseas demand and potential are there.Domestically, exports can play a major role in the restructuring of the economy from excessive dependence on (debt-driven) consumption. Housing is still in a deep slump and consumption, which represents 70% of the economy, has to contend with structural pressures such as stagnant real wages, household deleveraging and attempts to boost savings, and—one of these days—cuts by a federal government put on a spending diet.
Conclusion
US exports are in a largely unheralded growth phase. This will provide a much needed boost to the economy, offset some of the weaker domestic sectors and could potentially play a major role in the restructuring of the American economy.