Talk:Comparative advantage: Difference between revisions

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== The Heckscher-Ohlin model ==
== The Heckscher-Ohlin model ==


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::I think we need to mention the H-O-S model as something which is now looking rather irrelevant or even wrong. This is because many courses still teach it, and people will ask why it is not discussed here...--[[User:Martin Baldwin-Edwards|Martin Baldwin-Edwards]] 11:29, 13 November 2007 (CST)
::I think we need to mention the H-O-S model as something which is now looking rather irrelevant or even wrong. This is because many courses still teach it, and people will ask why it is not discussed here...--[[User:Martin Baldwin-Edwards|Martin Baldwin-Edwards]] 11:29, 13 November 2007 (CST)


== A proposal to give the article a revised structure. ==
==Revised Article==
 
:I think that I have said all that is needed on this subject, but I am open to correction.
This seems unnecessarily diffuse as it stands, and some could misinterpret it as suggesting that the law is a model rather than a logical statement.  
:I considered adding something on Samuelson-Stoper and much more on factor mobility, but decided that those topics would be better dealt with in the (unwritten) article on international economics.
 
[[User:Nick Gardner|Nick Gardner]] 09:30, 22 December 2007 (CST)
I suggest that it should start by a statement and explanation of the law on the following lines:
::''The law of comparative advantage  states  that, even if one of two producers  had an absolute advantage over the other  in every type of activity, both will benefit if each  concentrates upon what he does best and exchanges the product with the other . For example  it would pay a writer of best-sellers who was better at plumbing than any of the available plumbers, to stick to his writing and hire a plumber. What is true of skill differences is true also of other advantages, such as the possession of better tools or access to more advanced technology.  It was first formulated in terms of  differences  between countries, and  John Stuart Mill  illustrated it in terms of the trade in cloth and wine between Britain and Portugal'';
- followed first by an arithmetical demonstration of its logical necessity, then by a reference to the H-O factor endowment model (and the evidence to the contrary), and finally by a reference to  its use by economists to counter logically invalid "level playing field" arguments for trade restrictions.
[[User:Nick Gardner|Nick Gardner]] 11:30, 16 November 2007 (CST)

Latest revision as of 10:30, 22 December 2007

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 Definition:  The motive for trade that arises from the fact that for each trader there are things that he does best, and things that he can better obtain by trading. [d] [e]
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The Heckscher-Ohlin model

It doesn't seem right to mention the Hecksher-Ohlin model without noting that the United States (the world's most capital-intensive country) was since found to be exporting labour-intensive products and importing capital-intensive products. Since it seems to be generally accepted nowadays that factor endowments have no more than a minor influence upon trade patterns, is it worth mentioning Hecksher-Ohlin at all? Nick Gardner 10:34, 13 November 2007 (CST)
I think we need to mention the H-O-S model as something which is now looking rather irrelevant or even wrong. This is because many courses still teach it, and people will ask why it is not discussed here...--Martin Baldwin-Edwards 11:29, 13 November 2007 (CST)

Revised Article

I think that I have said all that is needed on this subject, but I am open to correction.
I considered adding something on Samuelson-Stoper and much more on factor mobility, but decided that those topics would be better dealt with in the (unwritten) article on international economics.

Nick Gardner 09:30, 22 December 2007 (CST)

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