ABSTRACT
Dealing with external markets, whether national, regional or global, necessarily means utilizing comparative advantage, which is based on the relative supplies of the various factors of production, chiefly labour, capital and natural resources and the productivity of their use, which can build competitive advantage. With increasingly free trade, countries have to pay attention to productivity even in the case of goods produced entirely for the domestic market, since they could be ousted by cheaper goods from outside. To the extent that indigenous peoples and households carry on some trade, their incomes are affected by trends in global productivity of their traded goods. But indigenous people face serious price problems in their exports, with social costs being lower than prices and thus leading to a subsidy by the producers.
