WELFARE-STATE MEASURES AND THE FREE MARKET IN INTERNATIONAL TRADE.

The article focuses on problems of trade between planned economies. These problems can be, firstly, problem of trade between economies in which free enterprise has simply ceased to exist. Secondly, the problem of trade between those countries and others, and finally, the problem of trade faced by partially socialized economies which practice state trading in some fields but not all, both among themselves and with enterprise economies. The conduct of trade is in the hands of state monopolies or boards which operate within the framework of agreements negotiated by governments. A country that indulges in a high degree of specialization in an international trading community in which a fair amount of competition prevails and in which prices are the principal guide to buying and selling, subjects its economic development to the dictates of the market. In return it obtains a higher per capita consumption or may support a larger population or both. There could be cases where the combination of credit and long-term contracts would be of advantage to both trading partners.