While regional division of labor or specialization is the mainstay of domestic and international trade, there are several other differences between the two. The differences between domestic and international trade are discussed below: Domestic trade The exchange of goods and services between different regions of the same country is called domestic trade. Geographical boundaries are not exceeded in domestic trade. The components of production within the same country, labor , capital and entrepreneurship are highly dynamic. In the case of domestic trade, there is no difference or difficulty in the monetary and banking system. International trade The exchange of goods and services between different sovereign countries is called international trade. International trade transcends geographical boundaries. Due to differences in climate , social customs , language, etc., the components of production cannot be easily mobilized. Currency and banking systems differ between different countries in international trade. Because in this system it is necessary to calculate the exchange rate between different currencies.