Question

Your professor hires a teaching assistant to grade student assignments even though your professor may do the task faster and perhaps more accurately. How can you explain this behavior using the theory of comparative advantage?

Answer 1

The behaviour of the professor can be explained using the theory of comparative advantage.

The theory of comparative advantage says that the country should produce that product in which it is more efficient and should import the product in which it is less efficient.

Now, the professor is effective at both teaching and grading assignments. However, if the professor is more efficient in teaching, then he will specialise and teach. The professor will then import the services for grading assignments. In terms of comparative advantage, the professor will do the task in which he is most effective and will hire someone for the task in which he is less effective.