Investigation of the influence of countries' participation in international trade organizations on foreign economic activity of different types of business

Issue: №11/3, 2019

Doi: https://doi.org/10.37634/efp.2019.11(3).3

Introduction. International trade allows to increase production and final consumption in the country as a whole by redistributing resources and using them more efficiently. Thus, with the increase in trade is expected to increase the specialization of countries. The purpose is to determine the impact of countries' accession to international trade organizations on their foreign trade activities, as exemplified by Ukraine. Results. It is small businesses that suffer the most from increased competition and trade diversion as a result of Ukraine's economic integration into international trade with WTO accession. This is due to the fact that they are not able to distribute their goods in different directions of trade, and therefore more vulnerable to the risks arising from changes in trade flows. Conclusion. A factor that theoretically increases the benefits of trade between countries is the difference in technological efficiency, the initial distribution of natural resources, capital and human capital, and the different preferences of the population. At the same time, increasing distance and other factors, including trade barriers, which have a negative impact on transportation costs, reduce the potential trade benefit. it should be borne in mind that such changes may have an adverse effect on individual businesses. Small businesses are most affected by such changes. This is due to the fact that they are not able to distribute their goods in different directions of trade, and therefore more vulnerable to the risks arising from changes in trade flows.

Keywords : foreign economic activity, trade flows, international trade organizations

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