Globalization and International Trade
The second chosen article has been taken from a journal of trade. The article "Transportation Costs and International Trade in the Second Era of Globalization" written by David Hummels has mentioned the importance of trade in the modern days (Weiss, 2010, p. 65). Globalization has important impacts on the economy of the countries but these days, trade has become more costly. Based on an increase in the fuel prices, there has been a great increase in transportation prices. The article has mentioned that more than 23% of the goods move between countries that are joined by land-based borders (Durdu, Mendoza, and International Monetary Fund. Research Dept, 2006, p. 78). Ocean and air modes are used for the transport of goods between countries. The article has highlighted the fact that air shipping and transport has been ignored and underestimated by the trade councils as most of the focus has been given to the ocean-based transportation. Since the last few years, it has been seen that the cost of air-based transportation has greatly decreased and has become more affordable as compared to the ocean-based transportation. The article has mentioned that since 1995, there has been a great decrease in the costs of air transportation of goods. Many facts have been highlighted by the article. The main aim of the article is to mention the issues being faced by the global trade. A cost of transportation is the main issue and there is a need that the issue is resolved by finding alternatives to more costly options as ocean transportation.
An important issue that has been raised by the article is to be taken into consideration by the World Trade Organizations (Hummels, 2007, p. 150). The fuels have gained prices and these gains in the prices have caused great issues for the companies that are involved in freight businesses and product transportation. It is important that solutions and alternatives are discovered, based on which global trade cab be more affordable. One of the important solutions mentioned in the article include air-based transportation that has...
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