International specialization and trade according to the principle of comparative advantage is mutually beneficial for all economies involved.

Question

Quizplus · Accepted Answer

According to the theory of comparative advantage, each country should specialize in producing the goods it can produce relatively more efficiently, and then engage in trade with other countries to obtain the goods it cannot produce as efficiently. This results in a more efficient allocation of resources globally, leading to higher levels of productivity and economic growth for all countries involved. Therefore, international specialization and trade according to comparative advantage is mutually beneficial for all economies involved.

International Specialization and Trade According to the Principle of Comparative