Tradability
viability of selling products far from their place of production
Tradability is the property of a good or service that can be sold in another location distant from where it was produced. A good that is not tradable is called non-tradable. Different goods have differing levels of tradability: the higher the cost of transportation and the shorter the shelf life, the less tradable a good is. Prepared food, for example, is not generally considered a tradable good; it will be sold in the city in which it is produced and does not directly compete with other cities' prepared foods. Some non-commodities and services such as haircuts and massages are also obviously non-tradable. However, in recent years even pure services such as education can be regarded as tradable due to advancements in information and communications technology.
Price equalization
Perfectly tradable goods, like shares of stock, are subject to the law of one price: they should cost the same amount wherever they are bought. This law requires an efficient market. Any discrepancy that may exist in pricing perfectly tradable goods because of foreign currency price movements, for instance, is called an arbitrage opportunity. Goods that cannot be costlessly traded are not subject to this law.
Begin with the source’s own compact description: “Tradability” is viability of selling products far from their place of production. The dossier treats that line as a proposition to test through Tradability, viability and selling, not as a finished interpretation.
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This entry incorporates text from “Tradability” on English Wikipedia. Contributors are listed in the page history. Text is available under the Creative Commons Attribution-ShareAlike 4.0 License. Selected authority identifiers and statements are retrieved from Wikidata under CC0; their references and qualifiers remain part of the verification path.