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An import is any good (e.g. a commodity) or service brought in from one country to another country in a legitimate fashion, typically for use in trade. It is a good that is brought in from another country for sale. like a country gives supplies to another country. Which means that they are exporting something. Import goods or services are provided to domestic consumers by foreign producer. An import in the receiving country is an export to the sending country.

Imports, along with exports, form the basis of international trade. Import of goods normally requires involvement of the customs authorities in both the country of import and the country of export and are often subject to import quotas, tariffs and trade agreements. When the "imports" are the set of goods and services imported, "Imports" also means the economic value of all goods and services that are imported. The macroeconomic variable I usually stands for the value of these imports over a given period of time, usually one year.

Balance of trade

Balance of trade represents a difference in value for import and export for a country. A country has demand for an import when domestic quantity demanded exceeds domestic quantity supplied, or when the price of the good (or service) on the world market is less than the price on the domestic market.

The balance of trade, usually denoted NX, is the difference between the value of the goods (and services) a country exports and the value of the goods the country imports:

NX = X - I, or equivalently I = X - NX

A trade deficit occurs when imports are large relative to exports. Imports are impacted principally by a country's income and its productive resources. For example, the USmarker imports oil from Canadamarker even though the US has oil and Canada uses oil. However, consumers in the US are willing to pay more for the marginal barrel of oil than Canadian consumers are, because there is more oil demanded in the US than there is oil produced.

In macroeconomic theory, the value of imports I can be modeled as a function of the domestic absorption A and the real exchange rate \sigma. These are the two largest factors of imports and they both affect imports positively:

I = I(A, \sigma)

Types of import

There are two basic types of import:

  1. Industrial and consumer goods
  2. Intermediate goods and services


Companies import goods and services to supply to the domestic market at a cheaper price and better quality than competing goods manufactured in the domestic market. Companies import products that are not available in the local market.

There are three broad types of importers:

  1. Looking for any product around the world to import and sell.
  2. Looking for foreign sourcing to get their products at the cheapest price.
  3. Using foreign sourcing as part of their global supply chain.


Direct-import refers to a type of business importation involving a major retailer (eg. Wal-Martmarker) and an overseas manufacturer. A retailer typically purchases products designed by local companies that can be manufactured overseas. In a direct-import program, the retailer bypasses the local supplier (colloquial middle-man) and buys the final product directly from the manufacturer, possibly saving in added costs. This type of business is fairly recent and follows the trends of the global economy.

Role of the Internet

Many online auction websites are now providing wholesalers through a wholesale list, generally, the lists that require a fee to view, may not be updated frequently, the data may be old, and the companies listed may no longer be in business.

Another form of online middlemen are B2B trade companies. These cater mainly to big businesses who are importing large quantities of goods from foreign countries. They also have sister sites that serve smaller orders for small businesses. In addressing the concerns of listed companies' legitimacy and dependability, such B2B portals may inspect suppliers at their actual premises before they list suppliers. Alternatively, these companies may also branch out of cyberspace and organize their own sourcing fairs, where thousands of buyers and suppliers can meet face-to-face.

References

  1. Burda, Wyplosz (2005): Macroeconomics: A European Text, Fourth Edition, Oxford University Press


See also




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