The Influence of David Ricardo’s Theory of Comparative Advantage on International Trade
David Ricardo <ul><li>Born in 1772 </li></ul><ul><li>At the age of 21, disinherited from family for marrying outside his f...
Theory of Comparative Advantage Mary Don
50 50 100 200 Maximum production if the entire month is spent in one activity,,,
25 25 50 100 If they spend half a month doing each activity
One day, Mary meets Don And Makes an Offer,,, 37 for 25
50 25 150 0 Before Trading,,,
After Trading,,, 25 50 37 113 37 for 25
Comparison,,, Maximum Consumption without trade: 25 25 50 100 Consumption after trade: 25 37 50 113 Gains from Trade: 25 F...
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Influence of David Ricardo's Theory of Comparative Advantage on International Trade

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Influence of David Ricardo's Theory of Comparative Advantage on International Trade

  1. 1. The Influence of David Ricardo’s Theory of Comparative Advantage on International Trade
  2. 2. David Ricardo <ul><li>Born in 1772 </li></ul><ul><li>At the age of 21, disinherited from family for marrying outside his family’s Jewish faith </li></ul><ul><li>Became a successful banker in London </li></ul><ul><li>Made a fortune as a stock broker in London </li></ul><ul><li>A Member of the Parliament of United Kingdoms </li></ul><ul><li>The most popular economist after Adam Smith </li></ul>
  3. 3. Theory of Comparative Advantage Mary Don
  4. 4. 50 50 100 200 Maximum production if the entire month is spent in one activity,,,
  5. 5. 25 25 50 100 If they spend half a month doing each activity
  6. 6. One day, Mary meets Don And Makes an Offer,,, 37 for 25
  7. 7. 50 25 150 0 Before Trading,,,
  8. 8. After Trading,,, 25 50 37 113 37 for 25
  9. 9. Comparison,,, Maximum Consumption without trade: 25 25 50 100 Consumption after trade: 25 37 50 113 Gains from Trade: 25 Fish

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