and of course, global trade allows many types of goods, especially consumer goods, to be purchased at lower prices. lower prices help all consumers but may be especially helpful to those with tight budgets. indeed, a number of the large, import - intensive retail chains in the united states are focused on low - and moderate - income consumers, who benefit from being able to buy a wide variety of lower - priced goods. another substantial benefit of trade is the effect it tends to have on the productivity of domestic firms and on the quality of their output. 4 by creating a global market, trade enhances competition, which weeds out the most inefficient firms and induces others to improve their products and to produce more efficiently. the u. s. manufacturing sector, which is perhaps the sector most exposed to international competition, has achieved truly remarkable increases in its productivity in the past decade or so. in addition, international supply chains, made possible by advances in communication and transportation, reduce costs and increase the competitiveness of u. s. firms. trade also promotes the transfer of technologies, as when multinational firms or transplanted firms bring advanced production methods to new markets. the estimates ranged from $ 7, 000 to $ 13, 000. cox and alm ( 2007 ) discuss the benefits of trade in the modern global economy. bernard and jensen ( 1999 ) find that exporting firms are more productive than non - exporters. bernard, jensen, and schott ( 2006 ) document the tendency of trade to reduce production at low - productivity plants and to increase output at highproductivity plants in the united states, a shift that raises average productivity. trade and finance are closely linked and mutually supporting, and in recent decades international financial flows have grown even more quickly than trade volumes. the globalization of finance plays to the strengths of u. s. financial institutions and financial markets. the united states has a large surplus in trade in financial services, and u. s. firms are leaders in providing banking, investment, and insurance services to the world. financial openness allows u. s. investors to find new opportunities abroad and makes it possible for foreigners to invest in the united states. the ability to invest globally also permits greater diversification and sharing of risk. trade benefits advanced countries like the united states, but open trade is, if anything, even more important for developing nations. trade and globalization are lifting hundreds of millions of people out of poverty, especially in asia, but also in parts

to minimize the pain of dislocation without standing in the way of economic growth and change. indeed, the willingness to embrace difficult challenges is a defining characteristic of the american people. with our strong institutions, deep capital markets, flexible labor markets, technological leadership, and penchant for entrepreneurship and innovation, no country is better placed than the united states to benefit from increased participation in the global economy. if we resist protectionism and isolationism while working to increase the skills and adaptability of our labor force, the forces of globalization and trade will continue to make our economy stronger and our citizens more prosperous. references acemoglu, daron, and joshua angrist ( 2001 ). " how large are human capital externalities? evidence from compulsory schooling laws, " in ben s. bernanke and kenneth rogoff, eds., nber macroeconomics annual. cambridge, mass. : mit press, pp. 9 - 59. becker, gary s. ( 1964 ). human capital : a theoretical and empirical analysis with special reference to education. new york : national bureau of economic research. bernanke, ben s. ( 2004 ). " trade and jobs, " speech delivered at the distinguished speaker series, fuqua school of business, duke university, march 30, http : / / www. federalreserve. gov / boarddocs / speeches / 2004 / 20040330 / default. htm _ _ _ _ _ _ ( 2006 ). " global economic integration : what's new and what's not? " speech delivered at the thirtieth annual economic symposium sponsored by the federal reserve bank of kansas city, jackson hole, wyo., august 25, http : / / www. federalreserve. gov / boarddocs / speeches / 2006 / 20060825 / default. htm _ _ _ _ _ _ ( 2007 ). " the level and distribution of economic well - being, " speech delivered at the greater omaha chamber of commerce, february 6, http : / / www. federalreserve. gov / boarddocs / speeches / 2007 / 20070206 / default. htm bernard, andrew b., and j. bradford jensen ( 1999 ). " exceptional exporter performance : cause, effect, or both? " journal of international economics, vol. 47 ( february ), pp. 1 - 25. bernard, andrew b., j. bradford jensen,