THE ROLE OF INTERNATIONAL TRADE AS A SOURCE OF UNITED
STATES ECONOMIC GROWTH
1.0 Introduction
To meet the needs will be easier with the existence of international trade for a country, such
as exports and imports on petroleum. An increase in state income, increased investment, and
more employment opportunities are other benefits of international trade. because local
products are marketed internationally through international trade and not only marketed
domestically, the national income of a country rises. International trade has a significant
influence on economic growth in a country, especially in developing countries such as United
States. Export and import activities such as the sale of services or capital goods are one of the
factors that affect economic growth in a country. (et al., 2019)
If a country exports more than it imports, its national income rises, which has a positive
impact on economic growth. Benefits International trade allows a country to specialize in
producing goods and services at low cost to export them abroad. International trade can
provide benefits such as increased income for the country, capital transactions, foreign
exchange reserves, and increased employment opportunities.(Fitriani, 2019)
According to data from the Central Statistics Agency (BPS), United States export value in
June 2022 amounted to US$26.09 billion. Compared to exports in May 2022 which amounted
to US$21.50 billion, the value increased by 21.30% (month-on-month/mom). The increase in
exports in June 2022 compared to May 2022, according to BPS statistics, was driven by an
increase in non-oil and gas exports by 22.71% (mom), from US$20.01 billion to US$24.55
billion. On the other hand, oil and gas exports increased by 2.45% (mom), from US$1.49
billion to US$1.53 billion. Similar to exports, the value of imports also increased every month
in June 2022. United States import value increased by 12.87% (mom) to US$21 billion in
June 2022 from US$18.60 billion in May 2022. Oil and gas imports increased by 9.52%
(mom) to US$3.67 billion, accounting for most of the monthly increase in import value.
Imports other than oil and gas rose by 13.60% (mom) to US$17.33 billion. In June 2022,
exports exceeded imports, resulting in a $5.09 billion surplus in United States trade balance.
This was up from a surplus of US$2.90 billion in May 2022.
The Central Statistics Agency (BPS) recorded that United States economic growth in the third
quarter of 2022 reached 5.72% on an annual basis. United States economic growth was higher
than that of the United States and China, but far behind Vietnam. United States annual
economic growth rate overtook China, which has posted the highest economic growth among
the G20 countries. China's economic growth in the third quarter only reached 3.9%. United
States economic growth was also higher than the United States, which only reached 1.81%,
Singapore 4.4%, and Taiwan 4.1%, but lower than Vietnam, which reached 13.7%.
In macroeconomic theory, export activities with the growth rate of the economy or national
income have a similar relationship due to exports and imports are one component with the
growth rate of the economy. When viewed from an expenditure point of view, exports and
imports are two important components of Gross Domestic Product (GDP), with changes in the
value of exports and imports directly affecting national income (Solomon, 2007).
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
1. Increase production and geographical coverage of trade markets.
2. Increase exports of goods and products to increase foreign exchange.
3. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
4. Technology modernization to improve the effectiveness of the production process
5. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
6. Increase production and geographical coverage of trade markets.
7. Increase exports of goods and products to increase foreign exchange.
8. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
9. Technology modernization to improve the effectiveness of the production process
10. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
11. Increase production and geographical coverage of trade markets.
12. Increase exports of goods and products to increase foreign exchange.
13. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
14. Technology modernization to improve the effectiveness of the production process
15. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
16. Increase production and geographical coverage of trade markets.
17. Increase exports of goods and products to increase foreign exchange.
18. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
19. Technology modernization to improve the effectiveness of the production process
20. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
21. Increase production and geographical coverage of trade markets.
22. Increase exports of goods and products to increase foreign exchange.
23. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
24. Technology modernization to improve the effectiveness of the production process
25. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
26. Increase production and geographical coverage of trade markets.
27. Increase exports of goods and products to increase foreign exchange.
28. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
29. Technology modernization to improve the effectiveness of the production process
30. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
31. Increase production and geographical coverage of trade markets.
32. Increase exports of goods and products to increase foreign exchange.
33. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
34. Technology modernization to improve the effectiveness of the production process
35. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
36. Increase production and geographical coverage of trade markets.
37. Increase exports of goods and products to increase foreign exchange.
38. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
39. Technology modernization to improve the effectiveness of the production process
40. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
41. Increase production and geographical coverage of trade markets.
42. Increase exports of goods and products to increase foreign exchange.
43. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
44. Technology modernization to improve the effectiveness of the production process
45. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
46. Increase production and geographical coverage of trade markets.
47. Increase exports of goods and products to increase foreign exchange.
48. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
49. Technology modernization to improve the effectiveness of the production process
50. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
51. Increase production and geographical coverage of trade markets.
52. Increase exports of goods and products to increase foreign exchange.
53. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
54. Technology modernization to improve the effectiveness of the production process
55. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
56. Increase production and geographical coverage of trade markets.
57. Increase exports of goods and products to increase foreign exchange.
58. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
59. Technology modernization to improve the effectiveness of the production process
60. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
61. Increase production and geographical coverage of trade markets.
62. Increase exports of goods and products to increase foreign exchange.
63. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
64. Technology modernization to improve the effectiveness of the production process
65. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
66. Increase production and geographical coverage of trade markets.
67. Increase exports of goods and products to increase foreign exchange.
68. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
69. Technology modernization to improve the effectiveness of the production process
70. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
71. Increase production and geographical coverage of trade markets.
72. Increase exports of goods and products to increase foreign exchange.
73. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
74. Technology modernization to improve the effectiveness of the production process
75. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
76. Increase production and geographical coverage of trade markets.
77. Increase exports of goods and products to increase foreign exchange.
78. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
79. Technology modernization to improve the effectiveness of the production process
80. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
81. Increase production and geographical coverage of trade markets.
82. Increase exports of goods and products to increase foreign exchange.
83. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
84. Technology modernization to improve the effectiveness of the production process
85. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
86. Increase production and geographical coverage of trade markets.
87. Increase exports of goods and products to increase foreign exchange.
88. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
89. Technology modernization to improve the effectiveness of the production process
90. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
91. Increase production and geographical coverage of trade markets.
92. Increase exports of goods and products to increase foreign exchange.
93. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
94. Technology modernization to improve the effectiveness of the production process
95. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
96. Increase production and geographical coverage of trade markets.
97. Increase exports of goods and products to increase foreign exchange.
98. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
99. Technology modernization to improve the effectiveness of the production process
100. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
101. Increase production and geographical coverage of trade markets.
102. Increase exports of goods and products to increase foreign exchange.
103. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
104. Technology modernization to improve the effectiveness of the production process
105. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
106. Increase production and geographical coverage of trade markets.
107. Increase exports of goods and products to increase foreign exchange.
108. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
109. Technology modernization to improve the effectiveness of the production process
110. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
111. Increase production and geographical coverage of trade markets.
112. Increase exports of goods and products to increase foreign exchange.
113. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
114. Technology modernization to improve the effectiveness of the production process
115. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
116. Increase production and geographical coverage of trade markets.
117. Increase exports of goods and products to increase foreign exchange.
118. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
119. Technology modernization to improve the effectiveness of the production process
120. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
121. Increase production and geographical coverage of trade markets.
122. Increase exports of goods and products to increase foreign exchange.
123. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
124. Technology modernization to improve the effectiveness of the production process
125. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
126. Increase production and geographical coverage of trade markets.
127. Increase exports of goods and products to increase foreign exchange.
128. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
129. Technology modernization to improve the effectiveness of the production process
130. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
131. Increase production and geographical coverage of trade markets.
132. Increase exports of goods and products to increase foreign exchange.
133. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
134. Technology modernization to improve the effectiveness of the production process
135. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
136. Increase production and geographical coverage of trade markets.
137. Increase exports of goods and products to increase foreign exchange.
138. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
139. Technology modernization to improve the effectiveness of the production process
140. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
2.0 Theoretical Foundation
2.1 International Trade
Business transactions between parties from other countries are referred to as international
trade. Examples of these business transactions include exporting products from one country to
another, investing in the construction of factories overseas, purchasing raw materials
overseas, manufacturing product components overseas and assembling them domestically,
and borrowing money from United Statesn banks to fund operations in other nations. In
addition to free trade and economic globalization, it is also recognized that no country can
meet all its needs without engaging in trade or business with other countries, so international
trade has become very important. (Diphayana, 2018)
World trade is another name for international trade. This is because different regions of the
world are involved in trade relations. The two components of international trade are imports
and exports. Buying products or services from abroad and bringing them into the country is
called importing. Selling goods and services from within the country to foreign markets is
known as exporting. Developed countries can obtain raw materials for their industries by
conducting import-export trade. In addition, countries These established countries can
exchange foreign currency for goods that they sell to developing countries so that these
countries can export home-made goods.
There are objectives to be met in international trade, in particular to meet a country's needs
that cannot be met there but can be met elsewhere. International trade serves a number of
other reasons besides meeting requirements that do not exist domestically, including the
following:
141. Increase production and geographical coverage of trade markets.
142. Increase exports of goods and products to increase foreign exchange.
143. Promote the expansion of the country's economic sectors, maintain commodity price
stability, and improve the efficiency of job creation.
144. Technology modernization to improve the effectiveness of the production process
145. Develop human resources who are superior, knowledgeable, skilled, and able to keep up
with technological advances (Purba et al., 2021).
International trade can promote a country's economic progress, according to Classical and
Neo-Classical economists. Trade between countries is the "engine of growth". This traditional
viewpoint can be traced back to David Hume, Ricardo, Marshall, Edgeworth, and Haberler.
The theory of comparative advantage was developed by one of the great writers, Ricardo. The
basic tenet of the idea is that each country will import commodities with a small comparative
advantage and export goods with a large comparative advantage, i.e. goods that can be
produced using factors of production that the country has in large quantities. Trade will
benefit both countries. As a result, there is a significant contribution of global trade to
economic growth. Trade expansion will increase the possibility of economic expansion.
There are several criticisms of this Classical view, including:
• First, because classical theory is static, it is unable to describe the growth process,
which is inherently dynamic.
• Second, trade actually exacerbates inequality between underdeveloped and developed
countries, contributing to global imbalances.
• Third, as a result of international trade, the exchange rate (terms of trade) of developing
countries declined. This is because imports consist of manufactured goods while exports
are still limited to basic goods.
Despite all these complaints, there is still enough evidence that global trade contributes to
economic progress.(Sattar, 2017)
2.2 Economic Growth
Robert Solow and Trevor Swan of the Massachusetts Institute of Technology developed this
economic growth hypothesis (Australian National University). This theory argues that the rate
of technological progress and the expansion of the supply of factors of production are
necessary for economic growth. According to this theory, which is based on classical analysis,
the economy will continue to experience full employment and the capacity of capital
equipment will always be fully utilized.
The capital-output ratio (COR) is also dynamic and subject to change. Depending on what is
needed, different capital can be used with varying labor to produce a certain amount of output.
Less labor is required when more capital is used, and vice versa when less capital is used.
With this adaptability, the economy has full discretion over the allocation of capital and labor
required to produce a given level of output.
The Cobb Douglas production function, created by Charles Cobb and Paul Douglas, is the
approach used by the Solow-Swan growth hypothesis. The Solow-Swan model, like the
Harrod-Domar model, focuses on the interaction between population expansion, capital
accumulation, technical progress, and production during the process of economic
growth.(Hidayat, 2017)
Based on a number of indices, including an increase in national income, per capita income,
and a decrease in the poverty rate, economic growth is an increase in the value and quantity of
goods and services produced by a country over a period of time. Economic growth can also be
seen as a process of continuous improvement in the state of the economy. A country's
economy is said to be growing if the increase in output of goods and services is a direct result
of people living there engaging in economic activity. The government is able to prepare for
future development and state revenue by understanding the rate of economic growth. On the
other hand, corporate actors can plan their resource and product strategies based on the rate of
economic growth.(Christianto, 2022)
3.0 Research Methods
The method used in this research uses a qualitative method with a descriptive type. The data
obtained comes from some secondary information obtained through websites, articles,
journals that are in line with the research theme. Through literature review, researchers try to
explain and describe descriptively about the research theme.
4.0 Results And Discussion
4.1 The Role of International Trade in United States Economic Growth
International trade is a type of transaction carried out between countries without tariff and
non-tariff barriers in the countries that agree on the policy. Trade is a voluntary exchange of
goods, services, assets and money owned by one institution to another. Because of this
voluntary nature, both parties to the transaction must be sure that the activities carried out will
benefit, because if they do not get a profit then the party will not continue the transaction
activities in question. Meanwhile, what is meant by international trade is trade carried out
between residents of more than 1 country. The population referred to in this case can be in the
form of humans / individuals, companies, organizations that do not expect profit (non-profit),
other association organizations. (Pranada, 2022)
Economic activity in society is a series that has existed in the law of various types, qualities,
variants carried out by private citizens, companies, and even the state in order to encourage
increased income. This role is carried out by collecting funds from the public in the form of
taxes, or channeling these funds to increase economic capital.
The international business model involves various aspects of the exchange of goods and
services of residents of one country with residents of another country to fulfill the needs of
life as a society products that cannot be produced domestically. In the exchange model,
technological development has encouraged the specialization of production that can be relied
upon as an exchange. Trade between two (2) countries can be carried out in 3 (three) ways,
namely, different characteristics, the same tastes, the same factors, different taste factors and
the same skill factors, different tastes. the potential or wealth of a country can be described by
the production possibility curve (PCC), while the pattern of taste or consumption can be
described by the indifference curve (IC).(Syofya, 2017).
In today's globalization era, international trade is a common activity, because of the diversity
of the economy through international trade that cannot be separated in the business world.
Import and Export activities are one of the important roles carried out in international trade in
the economic growth of a country, especially in United States.
Export activities carried out can increase income and increase the value of a country's
currency exchange rate, while when importing goods from abroad will supply the domestic
market. Not only limited to obtaining the desired goods, the United Statesn state must export
goods abroad with the aim of being able to improve the economy at this time and in the
future. In companies in developing countries, namely specifically in United States, which has
a fairly low currency exchange rate, it can be ascertained that by exporting goods, it will
increase the value of the currency exchange rate owned by the country so that it will increase
economic growth in United States itself.
Exporting is an easy form for developing countries to do to other countries, because
developing countries will easily attract foreign investors to participate in the simple domestic
business of developing countries. Then, obtaining services and products can be easier through
rich countries or developed countries.
When looked at more deeply, with a difference in the availability of natural resources due to
climate, weather, and natural conditions in a country, soil fertility, geographical layout,
culture, and politics will play an important role in increasing trade activities carried out with
several countries. Through existing data, it is known that very many European and American
continental countries like spices from United States. Because this is what made the Dutch
colonize United States. With quality spices, United States is also recognized by international
trade.
The existence of international trade is also one of the important roles in increasing economic
growth and development in a country. Through international trade and payments made can
have an influence on development carried out on 2 opposite tracks. If there are specialists and
income carried out with special techniques, it will provide maximum production results which
will affect the exchange process with foreign countries. With the value of quality natural
resources will also certainly increase the process of economic growth of the country.
The role of international trade has a positive impact on United States. However, there are also
negative impacts that occur because in the past the foreign market experienced a very
significant development, but was not accompanied by support from other sectors so that
international trade activities could not be carried out become a medium for the development
of the country.(Sugiharini, 2006)
In the past, United States only relied on capital provided by foreign countries as an investment
in managing existing natural resources. Through the results that have been obtained from
managing natural resources through capital from foreign countries then transferred back to the
country that provided the capital. It can be seen that this does not provide promising benefits
to countries that have natural resource wealth. These problems occur because United States
only relies on modern ways offered by foreign countries and does not seek solutions to
problems.
Furthermore, the relationship between our country and foreign countries affects the market
abroad, and this is called the "demonstration effect". This is the people in the country of
United States have a high desire to consume goods produced by foreign countries and often
United Statesn people follow the consumption patterns of foreign countries. This makes the
revenue earned by the country due to exports that should be used as savings to be reduced due
to the level of consumption or imports of people who continue to increase.
The following is an open opportunity and requires competition in obtaining it, this is an
advantage in order to achieve success in the economic growth of a country, namely: (Alkahfi
et al., 2023)
Absolut
Absolute is a form that occurs when a country is able to create products that are cheaper
and of higher quality than other countries. For example: United States, which has
abundant natural resources, such as spices and petroleum, is able to sell at a slightly
cheaper price than other countries.
Comparative
Comparative goods are goods that can be created by a country to produce goods more
efficiently than other countries. For example: making a Ferrari sports car with the help
of technology that is used as a car for racing.
When doing international trade, we must pay attention to several aspects that exist in the
country where we are going because not all opportunities that exist can be done directly.
There are several differences that must be considered, namely differences in culture,
economic levels, legal and political policies that are likely to become obstacles in doing
business internationally.
In addition to these obstacles, every business person must be able to decide and set policies on
ethical issues in doing business. In this case what is meant by business ethics is an activity
that distinguishes between good or bad habits from the point of view of the people in the
country. So business people must follow the ethics that exist in the country to be addressed.
The purpose of applying these ethics, namely:
In order to be able to encourage an increase in one's willingness to do business
To be a controller in conducting business activities
Contributions made and accepted as required instructions
Become a responsible media when immoral behavior occurs The following are some of
the factors that drive a country in conducting international trade, namely: (Hasoloan,
2013)
As a fulfillment of the need for goods and services in a country
In order to increase profits and income in a country
There are differences in the level of knowledge and technology to manage existing
natural resources
There are too many products in a country and a new market is needed to sell these
products.
There are differences in the availability of natural resources due to a country's
climate, weather and natural conditions, soil fertility, geographical layout, culture,
politics and population, which limit a country's production.
There are similarities in the appetite for consuming goods
Establish cooperation with other countries in order to gain benefits
The development of the globalization era that makes countries unable to live by
themselves
5.0 Conclusions
Exports carried out by the United Statesn state through the wealth of spices and quality
petroleum are one of the driving factors in economic growth in the country of United States.
However, people in United States have a high desire to consume goods produced by foreign
countries and often United Statesn people follow the consumption patterns of foreign
countries. This makes the revenue earned by the country due to exports that should be used as
savings to be reduced due to the level of consumption or imports of people who continue to
increase.
