Does purchasing imported goods mean we have to export?
On March 21, 2025, economist Don Boudreau quoted the following passage from a chapter written by Veronique de Rougie at Café Hayek:
here it is:
One of the biggest mistakes in trade is that the ultimate value of a country’s trade is seen in the export of a country, and imports are valuable because imports make the country’s export better. But in reality, the opposite is true. Imports are over, exports are a means. If we could get imports without exporting anything, it would have been the best in all of the world for us. Unfortunately, foreigners don’t work for us for free. We have to export because they want things in return for what they produce for us.
The context reveals Don Agres and Bello.
I rarely oppose Don or Vero about trade. But I’m doing it here.
I’ll start with the part I disagree with, the first judge:
One of the biggest mistakes in trade is that the ultimate value of the country’s trade is seen in the export of countries, and imports only agree as they allow exports.
It’s a spot and is often said.
That’s the rest I mainly disagree with. Consider the sentence in your sentences.
But in reality, the opposite is true. Imports are over, exports are a means.
There are two ends: import and export. I want an imported product: it’s one end. But exporters want to export. That’s their end.
If we could get imports without exporting anything, it would have been the best in all of the world for us.
If we can acquire imports without exports, it is not clear that it will be the best of all possible worlds. In particular, potential exporters don’t want to bother that they were like making money by exporting. Also, what happens if the alternative to export is to invest in our country for Haji foreign investment? That might be good. Details of that Anon.
Unfortunately, foreigners don’t work for us for free.
I agree.
We have to export because they want things in return for what they produce for us.
It is true that they want “in exchange for what they produce for us.” But what we have to export doesn’t follow. One way they get money to buy things from us is through our imports, and it is true that they take a lot of money from selling those imports (which are exports from their perspective) and buy our exports.
But imagine we spend a lot of it on imports. Do I need to sell exports? no. What happens if you don’t just buy US federal bonds, but also invest in Apple, Microsoft, Meta, etc., but also have Hage investment opportunities in the US? And what if there is a global demand to hold US dollars, as true? Exporters from other countries were able to receive the money they earned from exporting to us and investigate it in the US or hold it as dollars. Therefore, there is a strong empirical connection between exports and imports, but there is no connection required. In fact, our large account deficits and large checking surplus are evidence of this.
One case where Vero is correct is if none of the countries invested anything in another country. But that’s not the world we live in.
