The theory of absolute advantage suggests that trade is a positive-sum game in which all can gain to an even greater degree than the theory of comparative advantage.

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The theory of comparative advantage suggests that trade is a positive-sum game where all participants can benefit even if one has an absolute advantage in producing all goods. The theory of comparative advantage suggests that nations should specialize in producing goods where they have a comparative advantage and trade with other nations for goods where they have a comparative disadvantage. This leads to a more efficient allocation of resources, increased production, and increased gains from trade for all parties involved.

The Theory of Absolute Advantage Suggests That Trade Is a Positive-Sum