The Development Disparity Model to International Trade

The models used by the theories that formulate international trade provide evidence that disparities among countries form the basis of international trade. For instance the doctor is more developed than the secretary. Hence the secretary exports labor-intensive goods as she does not have a skilled workforce. These goods do not require intensely innovative efforts. Likewise since the doctor developed from the secretary the doctor mainly exports capital goods. These goods rely heavily on innovative efforts. Therefore developed countries intensely export innovative products. As a result international trade theory must focus on the reasons for the disparity in development among countries.