balance of trade

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Related to Trade Balances: Favorable Balance of Trade

Balance of trade

Net flow of goods (exports minus imports) between two countries.

Balance of Trade

The difference between the value of a country's exports and the value of its imports. If the value of exports exceeds that of imports, a country is said to have a trade surplus, while the opposite case is called a trade deficit. Analysts disagree on the impact, if any, of the balance of trade on the economy. Some economists believe that an overly large trade deficit causes unemployment and lowers GDP growth. Others believe that the balance of trade has little impact, because the more international trade occurs, the more likely it is that foreign companies will invest in the home country, negating any negative effects.

balance of trade

A net figure calculated by subtracting a country's imports from its exports during a specific period. If a country sells more goods and services than it purchases, its balance of trade is said to be positive, that is, exports exceed imports. Such a balance is generally considered to be favorable. Conversely, a negative balance is said to be unfavorable. A country's balance-of-trade position has great impact on its economic activity and on the profits of companies operating within it. See also trade deficit, trade surplus.

Balance of trade.

The difference between the value of a country's imports and exports during a specific period of time is called the balance of trade.

If a country exports more than it imports, it has a surplus, or favorable balance of trade. A trade deficit, or unfavorable balance, occurs when a country imports more than it exports.

balance of trade


balance of trade

a statement of a country's trade in GOODS (visibles) with the rest of the world over a particular period of time. The term ‘balance of trade’ specifically excludes trade in services (invisibles) and concentrates on the foreign currency earnings and payments associated with trade in finished manufactures, intermediate products and raw materials, which can be seen and recorded by a country's customs authorities as they cross national boundaries. See BALANCE OF PAYMENTS.
References in periodicals archive ?
A number of studies show, in line with a priori expectations, that a real exchange appreciation reduces the trade balance (Cline, 2010; Garcia-Herrero and Koivu, 2007; Groenewold and He, 2007).
Koo and Zhuang (2007) find that China's bilateral trade balance with the United States would improve if the renminbi appreciated against the US dollar.
However, little attention has been paid to the indirect macroeconomic effects of FDI on the current account through the trade balance.
Firstly, it aims to examine the effects of FDI on the trade balance via exports and imports.
Greater (lesser) trade balances for a national industry sector favor more lenient (strict) reviews of domestic merger activity under national welfare maximizing antitrust objectives.
Note that the more a domestic industry is characterized by a negative trade balance, the more these qualifications have previously been overcome; that is, negative trade balances suggest that trade entry distribution advertising barriers have been overcome and that foreign firms have superior efficiency relative to domestic firms.
The estimated effects of budget deficits on the trade balance range from the substantial [12] to statistically insignificant [7].
The controversy over the effects of devaluation on the trade balance arises because according to Frenkel and Johnson [1976, 42] "the monetary approach rejects the emphasis given to the role of relative prices in the analysis of devaluation.
While the critiques of the GL index are based on a presumed distortion in the measurement of the phenomena, which would only affect the aggregate version of the indicator, the inadequacy of the normalized trade balances as detectors of specialization is also found at the disaggregated level.
Japan electronics trade balance in the first six months of 1995 was a negative $14.