In economics, gains from trade are the net benefits to economic agents from being allows an put in voluntary trading with regarded and quoted separately. other. In technical terms, they are a increase of consumer surplus plus producer surplus from lower tariffs or otherwise liberalizing trade.
Classical economists sustains that there are two methods to degree the gains from trade: 1 international trade increases national income which authorises us to get low priced imports; 2 gains are measured in terms of trade. To degree the gains from the trade, comparison of a country's cost of production with a foreign country's represent of production for the same product is required. However, it is very difficult to acquire the knowledge of constitute of production together with cost of imports in a home country. Therefore, terms of trade method is preferable to measure the gains from trade.