Fashion and Economics

Globalization

The increasing integration of the world economy

Check your

labels….where

are your clothes

from?

Country Trips/YR $$/YRUS 22 $1044UK 18 $1144Germany 16 $1312Hong Kong

16 $1260

Korea 15 $520Taiwan 11 $1000France 11 $856Italy 11 $852Japan 8 $884Brazil 7 $776

Global Competition

Increased competition among countriesLabor is a major component of productionGovernment incentive

Balance of Trade

Import: goods that come into a country from foreign sources or goods that a country buys from another country

Export: goods that a country sends to a foreign source or goods that a country sells to other countries

Balance of Trade: relationship between a country’s imports and exports

Balance of Trade

Trade deficit: more imports than exportsTrade Surplus: country sells more goods

than it buys or importsUS has a large trade deficitJapan has a large trade surplus

Trade Agreements

NAFTA: North American Free Trade AgreementBetween US, Mexico, and CanadaDesigned to eliminate or reduce tariffs (fees) for

trading goods

WTO: World Trade OrganizationInternational organization that promotes trade

laws and regulationsWorks to reduce barriers in trade

International Fashions

Fashions produced in China with fabric made in India with buttons from Bali

Designed by a designer in FranceModeled on runways in Milan and ParisPurchased in NYC to wear to a trendy

party

What do you think the effect of the Internet has had on

international fashion?

Supply and Demand

Supply is the quantity of product offered for sale at all possible prices

Demand is the consumer’s willingness and ability to buy and/or use products

Interaction between these 2 factors cause surplus, shortage, or equilibrium

Supply and demand play a major role in the pricing of a product

Profit

Money a business makes after all costs and expenses are paid

The motivation to do business