The Pattern of International Trade Among Advanced Countries

Profes'or f h,ter" tio" 1 Econowies I . ProblemRecent studies on international trade, especially by the United Nations and GATT, disclose two significant trends in trade since World War 11 : a rapidly increasing trade among advanced industrial countries and a stagnating trade between advanced industrial countries and underdeveloped non-industrial countries.1Although both trade tendencies merit further investigation, this paper focuses on the increasing trade among advanqed countries in order to enable a more rigorous analysis on the kinds of commodities which have influenced the recent upsurge in trade.2Our findings reveal that the rapid expansion of trade among these countries has been primarily in the " horizontal trade " among manufactures, particularly heavy industrial and chemical products, rather than in the " vertical trade " between primary and manufactured goods.This significant feature is clearly evident in the intrabloc trade of the EEC (the European Common Market) and in the international trade among such highly advanced countries and areas as the United Kingdom, the United States, and the EEC.Among these countries, horizontal trade is extensive, covering the entire range of commodities exchanged, Among Japan.Canada, Australia, and New Zealand, however, horizontal trade is only partially developed, and trade is confined to a smaller range of commodities and only between particular partner countries.These findings present interesting questions relating to policy.To begin with, we need to know the causes or impetus of the recent growth of horizontal trade among the advanced countries.What new philosophy underlies this recent developme:nt ?These and other questions relating to the future trade development of these countries are discussed in the conclusion.