Question

David Ricardo, a famous English economist of the 19th century, stressed that a nation has a comparative advantage in those products for which its efficiency relative to other nations is the highest. He argued in favor of specialization and trade based on comparative, not absolute, advantage. From a global perspective, what would be the “advantage” of such a system?

Answer 1

It can actually be mentioned that David Ricardo on the ricardian theory of comparative advantage tells about the fact that comparative advantage should be the basis of trade and this is because of the fact that absolute advantage can be always with one country in all the goods and that the time there would be no trade and with the comparative advantage and in this regard advantages that every good would have comparative advantage in one of the country where a country can have comparative advantage even if there is no absolute advantage and in this world trade is possible on the whole