What is an invisible trade?

Invisible trade is a transaction where no physical assets change their hands. Services are a common example. When the passenger buys a ticket, the airline receives money and provides a service in the form of a flight to the passenger destination, but the customer does not receive tangible good. Worldwide, these financial activities form a significant part of global trade and their calculation is important for financial reporting, statistics and evaluation of economic health. All these transactions include transfers of value in exchange for proper consideration, but this consideration is not of physical nature. For example, the inventor who licensed the patent, for example, does not give the buyer a real patented object, but a license for its production with consent. Likewise, an investor who earns money from Sale shares has not given the buyer something physical value.

services such as banking, tourism and counseling are an important percentage of global invisible trade. UseThey are all over the world on different stages, from the transport of large amounts of bulk load to personal savings accounts for people who want to keep their money. Transfers of funds can also be significant because governments and large investors are moving money between nations for investment and other purposes. For example, the government may have to repay loans that could require creditors' transfer to another country and pay for the service offered when the government needs funds to pay for activities.

Tracking activities in this economic sector can provide insight into economic health. Changes in the volume of invisible business transactions can offer information about economic stability and misconception. For example, countries could end up with a business deficit, suggesting that they rely on from outside to meet their needs. In surpluses, money is brought through financial activities in other countries.

study of economic behavior and how the peopleThey interact with the economy, they can also consider invisible trade an example of one kind of transactions in which people can participate. Understanding how people appreciate intangible objects can be important for economists who must be able to describe fairly and precisely such property. This can play a role in politics; For example, governments must consider the value of intellectual property by developing politicians for licenses and protection of such assets.