What is the difference between JTA and a local transaction?
An example that shows when to use JTA and when to use a local transaction would be great.
JTA is a general API for managing transactions in Java. It allows you to start, commit and rollback transactions in a resource neutral way. Transactional status is typically stored in TLS (Thread Local Storage) and can be propagated to other methods in a call-stack without needing some explicit context object to be passed around. Transactional resources can join the ongoing transaction. If there is more than one resource participating in such a transaction, at least one of them has to be a so-called XA resource.
A resource local transaction is a transaction that you have with a specific single resource using its own specific API. Such a transaction typically does not propagate to other methods in a call-stack and you are required to pass some explicit context object around. In the majority of the resource local transactions it's not possible to have multiple resources participating in the same transaction.
You would use a resource local transaction in for instance low-level JDBC code in Java SE. Here the context object is expressed by an instance of java.sql.Connection. Other examples of resource local transactions are developers creating enterprise applications around 2002. Since transaction managers (used by JTA) were expensive, closed source and complicated things to setup around that era, people went with the cheaper and easier to obtain resource local variants.
You would use a JTA transaction in basically every other scenario. Very simple, small, free and open-source servers like TomEE (25MB) or GlassFish (35MB) have JTA support out of the box. There's nothing to setup and they Just Work.
Finally, technologies like EJB and Spring make even JTA easier to use by offering declarative transactions. In most cases it's advised to use those as they are easier, cleaner and less error prone. Both EJB and Spring can use JTA under the covers.