Transport, Communications, and Trade Dynamics
Transport and Communications
Transport
Rail transport: From the early 19th century to the second half of the 20th century, railways were the main means of ground transport because of their speed and carrying capacity. Today, they are heavily used for the transport of goods, as well as for passengers.
Road transport: Since car ownership became widespread in the mid-20th century, the number of roads and vehicles has increased steadily. Today, this is the most suitable form of ground transport for lightweight goods over short distances.
River and sea transport: River transport is limited. Sea transport is ideal for transporting heavy goods at a low cost. Passenger traffic is limited to ferries and cruise ships.
Air transport: Air travel is the most common means of transport for long-distance journeys.
Communications
The mass media (print, radio, television, and web-based media) transmit entertainment, information, and opinions to every corner of the planet. Telecommunications are long-distance communications systems. This sector experienced spectacular growth during the 20th century and continues to do so today.
The development of portable telephones (mobiles) and computer networks (the Internet) has been especially important in making these advances possible. As with transport, this phenomenon is known as the ‘communications revolution’.
THE GLOBAL VILLAGE
This concept presents the idea that the world has become a ‘global village’ thanks to technology and to the continuous information flow.
Commerce
General Characteristics
Commerce includes all economic activities that are intended to connect producers and consumers through the buying and selling of goods and services.
Some characteristic features of commerce today:
- It is governed by the principles of supply and demand.
- In terms of location, it is physically concentrated primarily in urban environments.
- Multinational companies are also increasingly important in international trade.
- In developed economies, the growth of commerce is based on consumption by consumers, inhabitants, and companies, and the significant production of goods and services.
- In developing economies, there is a mixture of high-level and low-level commercial transactions that range from international business deals between multinationals to street vending.
- It is reinforced through marketing, practices intended to stimulate consumption. These include advertising, image, communications campaigns, etc.
- It promotes new types of business, such as electronic commerce or e-commerce. This involves buying goods and services from distributors.
Domestic Trade
Domestic trade takes place within the borders of a country. These exchanges can be divided into two basic groups:
- Wholesale trade: which moves large quantities of merchandise in order to sell it to other merchants or companies.
- Retail trade: which involves buying from wholesalers and selling directly to consumers.
Products are sold in establishments:
- Street markets and street vending: temporary stalls, stands, or carts where sellers display and sell their goods.
- Traditional retailers: shops located in urban areas which sell directly to consumers.
- Large retail outlets: hypermarkets, supermarkets, shopping centers, etc.
Foreign Trade
Foreign trade is the exchange of goods and services between a country and the rest of the world. There are two types of exchange:
- Exports: which are the goods and services that are sold to foreign countries.
- Imports: which are the goods and services produced abroad and brought into the country.
Positive balance of trade: the value of exports exceeds the value of purchases, creating a surplus balance or trade surplus.
Negative balance of trade: the value of imports exceeds the value of sales, creating a deficit balance or trade deficit.
A country’s balance of trade and all economic transactions between that country and the rest of the world make up its balance of payments.
To facilitate trade, countries form organizations and trade blocs, which take action to stimulate the free movement of goods and services.
The World Trade Organization (WTO) works to ensure the fulfillment of trade agreements between member countries, resolve trade conflicts among them, and promote international trade.