Many early trade theories were created at a time when most factors of production either could not be moved or could not be moved easily across national borders.

Question

Quizplus · Accepted Answer

This is true. The early theories of trade, such as the theory of comparative advantage developed by David Ricardo, were based on the idea that different countries had different advantages in producing certain goods based on their availability of factors of production such as land, labor, and capital. At the time these theories were developed, it was much more difficult to move these factors of production across national borders, so the concept of trade was largely based on the exchange of finished goods rather than the movement of inputs.

Many Early Trade Theories Were Created at a Time When