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2018-08-16

Crisis

The authors, Karl Morasch, Florian W. Bartholomae compare in your book, the International economy, the two crises of the Great Depression (from 1929) and the last financial crisis (2008) on the basis of the commercial breaks – or, more specifically, on the basis of the development of world trade in goods, in percent of Maximum.

During the Great Depression, world merchandise trade contracted within a period of four years to less than a third of the original volume. An important reason for tariffs and quotas set by national governments to protect domestic companies. So the American government in 1930 increased, for example, by the Smoot-Hawley Act tariffs on over 900 import of goods.

Source: author presentation based on data from the WTO and the historical data from Kindleberger, C. P. (1975), The World in Depression, 1929-33, Berkeley: University of California Press.


In contrast, a different pattern is evident in the recent financial market crisis. The global trade volume decreased from 1.4 trillion US-Dollar in July 2008, within seven months to US $ 810 billion – a decline of 57 % of the maximum level. After this dramatic decline, the foreign trade has recovered but due to the world launched stimulus programs and Central Bank interventions, as well as the far-reaching renunciation of protective duties much faster.

Buchbeschreibung: The competition on the world market is becoming increasingly harder. The relationship between foreign trade and competition is therefore the focus of this textbook. The authors focus on the real economic aspects of the international economy. Contents of this textbook are behavior, the empirics of foreign trade, the analysis of the benefits and the pattern of trade under perfect and imperfect competition, the theory and the institutions of trade policy, as well as the implications for foreign trade and globalisation on corporate strategy and.

Image: © Martin hunter / pixelio.de

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