Borders, Differences, and the law of distance
East and West Germany removing national borders, intra - German trade increased.
The two governments took measures to preserve open trading relations still trading fell apart.
Positive outcome of increase trade
Large investment on Physical infrastructure rail lines and highways.
The law of distance
Geographic distance between 2 locations leads to the increase or decrease in trade between them.
Como currency, like the euro increase the trade in countries.
Two countries wit the same language have more trade.
Differences between level of corruption and political stability tend to decrease the trade flow.
Boarder sharing between countries typically increase trade than non adjoining countries
If the country was ever colonized the 2 countries could have more trade than the average.
Cultural distance: Different language, ethnicities, Religions (External)
Traditionalism, insularity, spiritualism (Internal)
Administrative: Lack of colonial ties, lack of common currency, different legal system, Political hostility (External)
Lack of membership in international organizations, non market and close economy, Societal conflict. (Internal)
Geographical Distance: Physical distance, lack of land border, climate, different time zones. (external)
Landlockedness, geographic size, remoteness (Internal)
Economic: Difference in availability in Human resources, financial, natural resources, infrastructure, Organizational capabilities.
CREATED BYDaniel Caballero Zacatecas