This essay is not intended to explain what is already well understood by professional economists, scholars of international trade. It is aimed at the general reader, the politician, the businessman and people involved or interested in property law and commerce.

 It explains the basis of exchange -that is, the economic law known as the Law of Comparative Costs- and penetrates into other important economic questions that have subtle implications for social, fiscal and economic policy, and are not trivial.

 General Theory of Exchange
 As will be seen, this "law" could more properly be called the General Theory of Exchange, as Professor Pascal Salin called it; or also Law of Association, as it was called by Ludwig von Mises*.

 Many economics textbooks leave the explanation of the General Theory of Exchange almost exclusively to chapters dealing with international trade, on the assumption that students have already understood the basic principles of exchange, an assumption I question.