A Simplistic View: The Ricardian Model of Trade
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Written by:
Patricia H
Date added:
March 16, 2016
Level:
University
Grade:
A
No of pages / words:
3 / 761
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Second, his model suggests that both countries get advantageous gain from free trade. However, the assumption that there is only one factor of production results in this said outcome. Third, the model implies that a technologically inferior country can benefit from free trade. Ron Rogowski illustrated an example of this by using the free trade of computers and shoes between the United States and Brazil...
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Ron Rogowski illustrated an example of this by using the free trade of computers and shoes between the United States and Brazil. In his scenario, any American worker compared to a Brazilian worker could produce more computers (50:5 ratio) and shoes (200:175 ratio), granting the United States with the absolute advantage good...
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