That was the title I wanted for this essay on comparative advantage, which pulls together several ideas that I first trotted out on this blog. The essay is lengthy. Here is a short excerpt:

To see why trade balance is an equilibrium condition, imagine a barter economy. In a barter situation, in order to pay for Indian software programmers, we would have to provide goods or services to India in exchange.

For Discussion. Does moving from a barter economy to an economy where money is a medium of exchange alter the status of balanced trade as an equilibrium condition?