Part 8/11:
Gains from Trade: Not Just Between Countries but Individuals and Companies
Economists emphasize the concept of gains from trade, which occur whenever two parties—be it individuals, companies, or countries—benefit from exchanging goods and services. The core idea is that trade is mutually beneficial because each side specializes in what they do best.
Example: If you sell me a product and I buy it, both of us benefit—otherwise, the trade wouldn't occur. When governments intervene with taxes or tariffs, they reduce these gains by increasing costs and dampening beneficial exchanges.