Explain three possible reasons for growth in the value of an economy’s exports of goods.

Net exports is the total value of all goods and services exported. The value of this can go up without necessarily increasing the volume of goods and services being exported, this requires a change in the cost of production or quality of the good. However if net volume of exports does go up (ceteris paribus) then the net value of goods and service exported will also go up. This question will outline three key ways that export value can increase; an increase in competitiveness, an increase in quality and an increase in foreign demand.Competitiveness can be increased by a range of factors such as inflation, infrastructure costs, supply costs and productivity. If UK inflation is low then it will be cheaper for foreign consumers to buy more UK goods and services, thus boosting the value of exports. If the UK is very productive then this will mean lower costs of production, thus price can be reduced whilst retaining profit margins, and also making goods more competitive. If the price of raw materials decreases the the cost of manufacturing goods will also go down, which could be translated into lower prices, thus boosting competitiveness. Infrastructure also affects competitiveness as if you cannot freely or cheaply export your goods then transport costs go up. An increase in quality also makes your goods more desirable and so demand can go up, this is more apparent in markets where quality is imperative like medicine. Finally an increase in demand in foreign markets can increase value of exports. This country could be experiencing a boom and so its consumers more willing to spend and thus import- increasing our economies value of exports.