Technological differences as a source of comparative advantage

Article Abstract:

Long-term comparative advantage is maintained not by owning a particular technology but by having institutions that continuously create new technologies. This is particularly true for high technology industries. Specialization creates a high volume of trade, and free trade would have three effects. Technological advance would be expedited internationally and technology would be diffused much more rapidly between countries.

Economic aspects, International aspects, High technology

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Internal returns to scale as a source of comparative advantage: the evidence

Article Abstract:

Trade models with increasing internal returns to scale (IIRS) create gains made from specialization. They also show that producers with great domestic demand have a competitive advantage in foreign markets. Gains from trade with IIRS include more customer satisfaction, because of a greater variety of products. IIRS makes it possible to shift rents between countries by creating profits and entry barriers.

Consumer goods industry

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Factor-supply differences as a source of comparative advantage

Article Abstract:

The essential issue of international economics is whether or not governments should intervene in international commerce. The study of international economics should have a balance of theory, issues and data. Economists should not take models as either true or false, but rather perceive of them as being helpful or misleading. The Heckscher-Ohlin model is both factually correct and incorrect.

Microeconomics

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