Following excerpts are from the book Economics, 9th edition, wrote by Paul A Samuelson.
Trade, Specialization, and Division of Labor
Specialization occurs when people and countries concentrate their efforts on a particular set of tasks.
It permits each person and country to use to best advantage the specific skills and resources that are available.
By contrast, countries which have tried the strategy of becoming self–sufficient-attempting to produce most of what they consume–have discovered that this is the road to stagnation.
Trade can enrich all nations and increase everyone’s living standards.
Specialization and trade are the key to high living standards. By specialization, people can become highly productive in a very narrow field of expertise. People can then trade their specialized goods for others’ products, vastly increasing the range and quality of consumption and having the potential to raise everyone’s living standards.
The major causes of financial-market integration have been the dismantling of restrictions on capital flows among nations, cost reductions, and innovations in financial markets, particularly the use of new kinds of financial instruments.
One consequence of economic integration is the unemployment and lost profits that occur when low-cost foreign producers displace domestic production.
A second consequence comes when financial integration triggers international financial crises.