Editing Trade (section)

{{Short description|Exchange of goods and services}}
{{Use dmy dates|date=November 2024}}{{About |the economic mechanism}}
[[File:Kaufmann-1568.png|thumb|upright|Two traders in 16th century Germany]]
[[File:MercadodeSanJuandeDios.jpg|thumb|upright=1.15|The [[San Juan de Dios Market]] in [[Guadalajara, Jalisco]]]]
[[File: Earle, Liberty to Trade as Buttressed by National Law, 1909 Title.jpg|thumb|''[[s:The Liberty to Trade as Buttressed by National Law|The Liberty to Trade as Buttressed by National Law]]'' (1909) by [[George Howard Earle, Jr.]]]]
{{Business administration}}

'''Trade''' involves the transfer of [[goods and services]] from one person or entity to another, often in exchange for [[money]]. Economists refer to a [[system]] or network that allows trade as a [[market (economics)|market]].

Traders generally negotiate through a medium of credit or exchange, such as money. Though some economists characterize [[barter]] (i.e. trading things without the use of money<ref name="Samuelson1939">{{cite journal |last1=Samuelson |first1=P. |date=1939 |title=The Gains from International Trade |journal=The Canadian Journal of Economics and Political Science |volume=5 |issue=2 |pages=195–205 |doi=10.2307/137133 |jstor=137133}}</ref>) as an early form of trade, [[History of money#Emergence of money|money was invented]] before written history began. Consequently, any story of how money first developed is mostly based on conjecture and logical inference. Letters of [[credit (finance)|credit]], [[paper money]], and [[digital currency|non-physical money]] have greatly simplified and promoted trade as '''buying''' can be separated from '''selling''', or [[Earnings|earning]]. Trade between two traders is called [[bilateral trade]], while trade involving more than two traders is called [[Multilateral treaty|multilateral trade]].  

In one modern view, trade exists due to specialization and the [[division of labor]], a predominant form of [[economic activity]] in which individuals and groups concentrate on a small aspect of production, but use their output in trade for other products and needs.<ref name="DollarKraay2004">{{cite journal |last1=Dollar |first1=D. |last2=Kraay |first2=A. |date=2004 |title=Trade, Growth, and Poverty |url=http://econ.worldbank.org/files/1820_dollar.pdf |url-status=dead |journal=The Economic Journal |volume=114 |issue=493 |pages=F22–F49 |citeseerx=10.1.1.509.1584 |doi=10.1111/j.0013-0133.2004.00186.x |s2cid=62781399 |archive-url=https://web.archive.org/web/20040307191641/http://econ.worldbank.org/files/1820_dollar.pdf |archive-date=2004-03-07 |access-date=2017-10-26}}</ref> Trade exists between regions because different regions may have a [[comparative advantage]] (perceived or real) in the production of some trade-able goods{{snd}}including the production of scarce or limited natural resources elsewhere. For example, different regions' sizes may encourage [[mass production]]. In such circumstances, trading at [[market price]] between locations can benefit both locations. Different types of traders may specialize in trading different kinds of goods; for example, the [[spice trade]] and [[grain trade]] have both historically been important in the development of a global, international economy.
[[File:A Busy Market in Mile 12, Lagos- Nigeria.jpg|alt=A picture of a busy market in Mile 12. Lagos - Nigeria|thumb|A busy market in Mile 12, Lagos, Nigeria]]
[[Retail]] trade consists of the [[sales|sale]] of goods or [[merchandise]] from a very fixed location<ref>Compare [[peddling]] and other types of retail trade:{{cite book
| editor1-last = Hoffman
| editor1-first = K. Douglas
| title = Marketing principles and best practices
| url = https://www.shantraader.co.in/
| edition = 3
| publisher = Thomson/South-Western
| date = 2005
| page = 407
| isbn = 978-0-324-22519-8
| access-date = 2018-05-03
| quote = Five types of nonstore retailing will be discussed: street peddling, direct selling, mail-order, automatic-merchandising machine operators, and electronic shopping.
| archive-date = 2022-10-22
| archive-url = https://web.archive.org/web/20221022165517/https://www.shantraader.co.in/
| url-status = live
}}</ref> (such as a [[department store]], [[boutique]], or [[kiosk]]), [[online]] or by [[mail]], in small or individual lots for direct [[consumption (economics)|consumption]] or use by the purchaser.<ref name="fas">{{cite web | date= 2000-02-09 | url= http://www.fas.usda.gov/info/factsheets/China/distribution.html | title= Distribution Services | publisher= [[Foreign Agricultural Service]] | access-date= 2006-04-04 | url-status= dead | archive-url= https://web.archive.org/web/20060515063319/http://www.fas.usda.gov/info/factsheets/China/distribution.html | archive-date= 2006-05-15 }}</ref> [[Wholesale]] trade is the traffic in goods that are sold as merchandise to [[retailer]]s, industrial, commercial, institutional, or other professional [[business]] users, or to other wholesalers and related subordinated services.

Historically, openness to [[free trade]] substantially increased in some areas from 1815 until the outbreak of World War I in 1914. Trade openness increased again during the 1920s but collapsed (in particular in Europe and North America) during the [[Great Depression]] of the 1930s. Trade openness increased substantially again from the 1950s onward (albeit with a slowdown during the [[1973 oil crisis|oil crisis of the 1970s]]). Economists and [[economic historians]] contend that current levels of trade openness are the highest they have ever been.<ref>{{Cite journal|last1= Federico|first1= Giovanni|last2= Tena-Junguito|first2= Antonio|date= 2019|journal= Revista de Historia Economica – Journal of Iberian and Latin American Economic History|volume= 37|issue= 1|pages= 9–41|doi= 10.1017/S0212610918000216|issn=0212-6109|title= World Trade, 1800-1938: A New Synthesis|doi-access= free|hdl= 10016/36110|hdl-access= free}}</ref><ref>{{Cite web|url= https://voxeu.org/article/world-trade-historical-database|title= The World Trade Historical Database|last1= Federico|first1= Giovanni|last2= Tena-Junguito|first2= Antonio|date= 2018-07-28|website= VoxEU.org|access-date= 2019-10-07|archive-date= 2019-10-07|archive-url= https://web.archive.org/web/20191007142603/https://voxeu.org/article/world-trade-historical-database|url-status= live}}</ref><ref>{{Citation|last1= Bown|first1= C. P.|date= 2016-01-01|url= http://www.econ.cam.ac.uk/research-files/repec/cam/pdf/cwpe1624.pdf|volume= 1|pages= 3–108|editor-last= Bagwell|editor-first= Kyle|publisher= North-Holland|access-date= 2019-10-07|last2= Crowley|first2= M. A.|title= The Empirical Landscape of Trade Policy|series= Handbook of Commercial Policy|doi= 10.1016/bs.hescop.2016.04.015|isbn= 978-0444632807|s2cid= 204484666|editor2-last= Staiger|editor2-first= Robert W.|archive-date= 2021-02-25|archive-url= https://web.archive.org/web/20210225171856/http://www.econ.cam.ac.uk/research-files/repec/cam/pdf/cwpe1624.pdf|url-status= live}}</ref>