Absolute Advantage vs. Comparative Advantage
In the chapter Wheelan talks about Absolute Advantage by giving an example of Saudi Arabia. He explains that it's about how when 2 countries have a good crop of different goods, when they trade, they trade their crops fairly. It could be indirectly, like the example of Microsoft to rice, but there is still that one for one trade. At the end of the explanation he compares Saudi Arabia to Tiger Woods, which kind of dates the book in a whole, considering Tiger Woods became a sort of untouchable subject...
Comparative Advantage was shown with an example of Bangladesh and Seattle. The engineers of Seattle have doctorates in their craft, and are therefore more qualified to make shirts and shoes, but then they would be spending their time making those shirts and those shoes, instead of making Boeings, and important software. In turn, the people of Bangladesh who are poorly educated make the shirts and the pairs of shoes.
The way Wheelan describes both of these different advantages in the market place in very visual and grabable ways.
All This was done at 10 PM at school^
This Explanation makes the understanding of the concepts a lot easier for me.
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