Trade Deficit

A trade deficit occurs when a country imports more goods and services than it exports. This means that the country is spending more money on foreign goods and services than it is receiving from foreign sales. A trade deficit is also known as a negative balance of trade. It is an economic indicator that can be used to measure the health of a country’s economy.

History of Trade Deficits

The concept of a trade deficit has been around since the early days of international trade. In the 18th century, the British Empire was the first to experience a trade deficit. This was due to the fact that the British were importing more goods from other countries than they were exporting. This trend continued throughout the 19th and 20th centuries, with the United States experiencing its first trade deficit in the 1970s.

Since then, trade deficits have become a common occurrence in many countries. In the United States, the trade deficit has grown steadily since the 1980s. In 2019, the U.S. trade deficit was $621 billion, the highest it has ever been.

Table of Comparisons

Summary

A trade deficit occurs when a country imports more goods and services than it exports. This means that the country is spending more money on foreign goods and services than it is receiving from foreign sales. The concept of a trade deficit has been around since the early days of international trade, and the United States has experienced a trade deficit since the 1970s. In 2019, the U.S. trade deficit was $621 billion, the highest it has ever been. For more information on trade deficits, visit the websites of the World Bank, the International Monetary Fund, and the U.S. Bureau of Economic Analysis.

See Also

• Balance of Trade
• Current Account Balance
• Foreign Exchange Reserves
• Gross Domestic Product
• International Trade
• Protectionism
• Tariffs
• Trade Surplus
• World Trade Organization
• Exchange Rate

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