Skip to main content Skip to Search Box

Definition: trade from Collins Dictionary of Business

the exchange of goods, services and financial securities between BUYERS and SELLERS. In most cases trade takes place using MONEY as a means of exchange in buying and selling transactions, though occasionally trade can involve direct BARTER. See MARKET SYSTEM, INTERNATIONAL TRADE.

Summary Article: trade
From The Dictionary of Human Geography

Under normal capitalist conditions, the transportation and exchange of commodities for money. As such, trade provides a vital link between production and consumption in capitalist commodity chains. It is through trade that commodities reach their markets, and it is only when commodities are sold into markets that the value produced by the exploitation of workers is abstracted out and represented in the exchange values or prices generated by market trading (Harvey, 1999 [1982]). For these reasons, trade derives both its immense significance and considerable contemporary contentiousness from the ways in which it is interwoven with the wider political–economic organization of capitalism.

When it occurs across national borders, trade serves to create international economic ties. As a result, international trade statistics provide some of the best data available about the actual economic interdependencies underpinning globalization. Trade data showing global increases in international trade outstripping growth in overall global GDP provide a useful indication of the degree to which contemporary forms of capitalist development are characterized by increasingly cross-border flows (Dicken, 2003). Roughly 40 per cent of international trade is actually intra-corporate trade – that is, border-crossing trade that nevertheless remains within the internal commodity chains of a particular TNC (Gabel and Bruner, 2003) – revealing the corporate control of these flows within the networks of global corporations (see transnational corporations (tncs)). Meanwhile, maps of import–export data (see figure) exhibit the uneven economic integration and triadic geographical structure of these economic flows, in which over 80 per cent of trade takes place between Europe, North America and Asia. Yet while trade data can help us better map global capitalism’s uneven development, the contentious debates over today’s terms of trade also need to be understood in relation to the profoundly politicized discourses surrounding the asymmetries and inequities of trade-mediated interdependencies.

trade Global import and export flows

Many free market fundamentalists insist that trade is always good without ever pausing to consider such basic questions as: The trade of what? For whom? And under what contextual conditions? The transatlantic slave trade that turned Africans into commodities, for example, can hardly be held up as an unmitigated good (see Wolf, 1982). And the recent for-profit trade in blood plasma from Haiti to the USA and Europe reveals how despite historic victories over slavery, its legacies still provide a vampiric verso of economists’ unending odes to free trade in the present (Farmer, 2006). But even putting such odious examples aside, studies of the political and economic geographies in which trade takes place make universal claims about the goodness of trade seem absurd (Sheppard and Barnes, 1990; Merrett, 1996; Porter and Sheppard, 1998; Gilbert, 2005). One of the major weaknesses of mainstream macroeconomics is that it continually abstracts from these geographies, mirroring but ignoring the ways in which capitalist trading relations affix prices to commodities that crystallize out their abstract value (but see Fireside and Miller, 2005). All the focus is on the economic benefits – never on the social, political and environmental ills that commodity production and trade so often entails.

Going back to David Ricardo’s nineteenth-century account of comparative advantage – which abstracted from the political–economic imperatives that were driving British manufacturers to seek new foreign markets for their products – abstractions such as ‘opportunity costs’ have continually led economists to obscure the uneven international and personal power relations in which trade takes place. Yet notwithstanding endless economic modelling demonstrating the supposed efficiencies of trade, and notwithstanding the repeated emphasis on the gains from trade in economics textbooks, the geographical context of trade still matters – and often reveals the losses from trade. This has become especially clear in contemporary debates over free trade and fair trade.

When the novelist Margaret Atwood joined other Canadians in contesting the Canada–USA Free Trade Agreement, she pointed to the discursive power of free trade by underlining how it hinges on the positive association of the word ‘free’, ‘as in free gift, free lunch, free world and free speech’ (Atwood, 1993, p. 93). Against this, Atwood argued that free trade in fact represented the systematic straitjacketing of Canada’s democratic autonomy and policy-setting freedom. Many other critics in Canada repeated the argument that free trade threatened everything from public health services to national development initiatives to food safety to cultural creativity. Subsequent protests from Seattle to Singapore have made similar arguments against the world trade organisation, underlining the many areas of social, political and environmental policy-making that are straitjacketed by trade laws (Peet, 2003; Wallach and Woodall, 2004). At the heart of these criticisms is a concern with the ways in which free trade agreements create systems of rule or state effects that, while granting TNCs quasi-constitutional rights, simultaneously undermine any sort of democratic rights for the subject populations who want to question and reform the new rules (Gill, 2003; El Fisgón, 2004; Sparke, Brown, Corva et al., 2005). Based on these concerns and critiques, diverse transnational groupings from the world social forum to the Intercontinental Caravan are converging to deliberate and delineate diverse alternatives, including diverse forms of fair trade (Featherstone, 2003; Routledge, 2003; Sparke, Brown, Corva et al., 2005; Routledge, Nativel and Cumbers, 2006). Meanwhile, new work by feminist economic geographers points hopefully (and despite its capitalist government funding) towards non-capitalist, extra-capitalist and, most idealistically, post-capitalist forms of trade that is ‘free’ – from poverty, patriarchy and corporate control (Gibson-Graham, 2006c: see also feminist geographies).

Matthew Sparke
Professor of Geography
University of Washington, USA
© 2009 by Blackwell Publishing Ltd except for editorial material and organization, © 2009 Derek Gregory, Ron Johnston, Geraldine Pratt, Michael J. Watts, and Sarah Whatmore

Related Articles

Full text Article Trade
Encyclopedia of Global Studies

Trade refers to a global pattern of exchange in which goods and services produced in one political jurisdiction are consumed in another. The...

Full text Article Trade
Encyclopedia of Geography

Trade is usually defined as the exchange of goods and services among countries. That exchange is a type of spatial interaction, or movement,...

Full text Article TRADE
The Anti-Capitalist Dictionary

involves the exchange of commodities like currency, manufactured items and natural resources, as well as the provision of services such as...

See more from Credo