Read the required journal articles by Schumacher XXXXXXXXXXand Palley XXXXXXXXXXregarding the theory of comparative advantage. In a critical essay, compare and contrast Smith's original theory as...

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Read the required journal articles by Schumacher (2012) and Palley (2008) regarding the theory of comparative advantage. In a critical essay, compare and contrast Smith's original theory as indicated in the Schumacher (2012) article. What, in contrast, is Palley's (2008) observation regarding the modern view of comparative advantage? Differentiate these views and support your findings with additional academic references.


Readings:


Palley, T. I. (2008). Institutionalism and new trade theory: Rethinking comparative advantage and trade policy.
Journal of Economic Issues (Association for Evolutionary Economics), 42
(1), 195-208.



  • Schumacher, R. (2012). Adam Smith's theory of absolute advantage and the use of doxography in the history of economics.
    Erasmus Journal for Philosophy and Economics, 5(2), 5480



Answered Same DayDec 27, 2021

Answer To: Read the required journal articles by Schumacher XXXXXXXXXXand Palley XXXXXXXXXXregarding the theory...

David answered on Dec 27 2021
117 Votes
Theory of comparative advantage
Comparative advantage is said to be present when one economic agen
t can make a
good or provide a service at a lower trade-off cost than other, in terms of international trade it
is said to be present when one nation can produce a product or service at a lower next best
alternative cost than another.
Today textbooks try to present Adam Smith's theory of international trade but they
fall short of Smith's original views this is because of editing of Smith's ideas to include them
into history of international trade (Schumacher (2012)). According to Schumacher Adam
Smith's work is still not outdated and it still hold explanation to economic events of today,
however most economics textbooks did not try to go deeper in explanation of Adam Smith
theory, they starts with introduction to Adam Smith theory of absolute advantage and then
move on to explaining theory of comparative advantage Which was first introduced in...
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