MICROECONOMICS PRINCIPLES WITH ETHICS

MODULE 5: Production and Comparative Advantage

Textbook Reading:

Presentation Slides:

Production and Comparative Advantage - Last updated Sept 2020

Additional Useful Information:

Pass The Port - David Ricardo's Comparative Advantage Is 200 Years Old Today
(April 2017) This Forbes article discusses the 200-year history of comparative advantage.

Ricardo's Difficult Idea
(1996) This article by Paul Krugman highlights the importance of the principle of comparative advantage.

OVERVIEW

This module introduces production into the pure exchange model. It defines the concepts of absolute and comparative advantage and demonstrates how specialization in one's comparative advantage good followed by trade can improve economic efficiency.

VIDEO LECTURE

Production and Comparative Advantage Part 1 - 67 minutes