What is the comparative advantage of international trade
20 Feb 2017 From David Ricardo's "comparative advantage principle" to James Meade's Neoclassical or mainstream economics proof of self-adjusting free Comparative Advantage of International Trade The challenge to the absolute advantage theory was that some countries may be better at producing both goods and, therefore, have an advantage in many areas. The impression is false, that is, if one assumes, as comparative-advantage theory does, that international trade is an exchange of goods between countries. It is pointless for country A to sell goods to country B, whatever its labour-cost advantages, if there is nothing that it can profitably take back in exchange for its sales.