Free trade causes job losses in industries in which a country does not have a comparative advantage, but it also causes job gains in industries in which the country has a comparative advantage.

Question

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Free trade allows countries to specialize in the production of goods and services where they have a comparative advantage, leading to job gains in those sectors. Conversely, industries where a country lacks a comparative advantage may shrink due to competition from imports, causing job losses.

Free Trade Causes Job Losses in Industries in Which a Country