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RE: LeoThread 2025-03-07 13:11

in LeoFinance7 months ago

Part 2/7:

A favorable balance of trade is typically perceived to mean that a country exports more than it imports. This interpretation, however, can be misleading. From the standpoint of individual well-being, a situation in which a country exports more than it imports can actually lead to unfavorable outcomes. For instance, in private household terms, if one has to send out more goods in exchange for receiving less, it hardly signifies a favorable exchange. In reality, a favorable situation would entail receiving more goods for fewer exports.

This perspective shifts our understanding from focusing solely on production to a more nuanced view that includes consumption.

The Visible vs. Invisible Effects of Tariffs