Gains from Trade

… a core concept in Economic Analysis

Click for MRU video, minute 3:10 - 3:40

Click for MRU video, minute 3:10

Concept description

Gains from trade are the net benefits to buyers and sellers of allowing an increase in voluntary trading with each other.

Wikipedia notes that, in technical terms, the gains from trade is the increase in consumer surplus plus producer surplus.

Alex Tabarrok (reference below and video to right) illustrates the gains from worldwide trade among buyers and sellers of oil.

Source

Wikipedia, Gains from trade, at https://en.wikipedia.org/wiki/Gains_from_trade, accessed 19 April 2016.

Alex Tabarrok, The Equilibrium Price, Marginal Revolution University, at http://www.mruniversity.com/courses/principles-economics-microeconomics/equilibrium-price-supply-demand-example, accessed 19 April 2016.

Atlas topic and subject

Supply, Demand, and Equilibrium (core topic) in Economic Analysis.

Page created by: Ian Clark, last modified on 19 April 2016.

Image: Minute 3:50 of MRU Video, at http://www.mruniversity.com/courses/principles-economics-microeconomics/equilibrium-price-supply-demand-example, accessed 19 April 2016.