Trade creation
What Trade creation means in Economics B A-Level, as defined for Pearson Edexcel.
Definitions of Trade creation
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Check what you remember
Read the wording for your board, then hide it and explain Trade creation in your own words. Rough notes are fine. This is a self-check, with no mark or grade.
Reference: Pearson Edexcel
The replacement of expensive domestic production with cheaper imports from a member state, shifting production to more efficient member states.
The shift from high-cost domestic production to lower-cost production within a trading bloc when internal tariffs are removed.
Topics that use Trade creation
- International trade (Pearson Edexcel A-Level)
- Trading blocs (Pearson Edexcel A-Level)
Related terms
- Trade diversion
- Trading blocs
- Comparative advantage
- Economic interdependence
- Free trade area
- Macroeconomic shocks
- Opportunity cost
- Over-specialisation
Using Trade creation in the exam
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