What factors affect a country's decision to trade goods and services with another country?

Question

What factors affect a country's decision to trade goods and services with another country?

Answer 1

it think it would be better if we didnt owe them money and where allies with them or all least has a agreement set up. but the u.s owes almost every country money and has very few allies cause we screwed people over and by we i mean our government.

Answer 2

the need for those goods and services

Answer 3

There are gains from trade for both country's  economy because  the combined market  has a more efficient use of   resources. However  there will be winners and losers  in both countries  so the decisions about   trade  will be political as well as economic, and will be determined by the relative power of winners and losers in the country. England became free trading  when the landed  gentry  lost political power to the merchant class and the coalition of farmers and  industrialist against free trade  blocked free trade in Germany when American wheat became available  on the European markets. The divisions between the American North and South that led to the civil   war had as one of the causes the different effect  trade had on the regions. Currently the freer trade in the US is the result of the loss  of political power by industrial workers as we became a service economy  with only a small fraction of our workers  in manufacturing jobs that compete with imports, and the more we trade the weaker the opposition to trade becomes.

Answer 4

The key factor is if someone has a comparative advantage in producing 1 good to another.  If many good are produced, than one country will always have a comparative advantage in a good.