Does a country s theory of comparative advantage change over time?

The theory of comparative advantage is a very important theory in international studies, it is not a theory of any country, but a theory that works on a global scale, and its theoretical system does not change with time.

But a country's comparative advantage changes over time, and with the development of science and technology, economic development, and technological progress, a country's comparative advantage will change. For example, in the 19th century, Western capitalist countries led by Britain.

With a strong comparative advantage, they occupied the Great Industrial Revolution.

But with their economic development, their labor costs have risen, their comparative advantages have been lost, and they have gradually been replaced by some rising stars such as Japan and South Korea, and after decades of development, Japan and South Korea have lost their advantages in labor costs, and many labor-intensive industries have gradually moved to China. China's reform and opening up.

Over the past few decades, the people's living standards have been greatly improved, and labor costs have also been greatly improved.

or the regional shift in Africa, which is the result of the theory of comparative advantage.

In accordance with this theoretical law, our country is constantly carrying out industrial upgrading and industrial readjustment, with the aim of continuing to maintain its comparative advantage in the face of rising labor costs.

The traditional H-O theory is basically a static theoretical system, which lacks a dynamic perspective to analyze the resource endowment and comparative advantages of various countries. In order to overcome the shortcomings of the traditional international theory, some economists have begun to seek new theories and policy options outside the framework of the H-O theory, and the most influential theory in this regard is the theory of national competitive advantage. Porter believes that a country's advantage is not simply determined by a country's natural resources, labor, interest rates, and exchange rate as claimed by the traditional international theory, but to a large extent determined by a country's ability to innovate and upgrade.

As contemporary international competition relies more on the creation and absorption of knowledge, the formation and development of competitive advantage has increasingly gone beyond the scope of a single enterprise or industry, and is the result of the comprehensive action of various factors within an economy, and a country's values, culture, economic structure and history have become the result of competitive advantage. Porter's model of international competitive advantage, also known as the diamond model, includes four national specific determinants and two external forces. The four determinants of a country include factor conditions, demand conditions, related and supporting industries, and the strategy, organization, and competition of the firm.

The two external forces are random events.

The theory of comparative advantage changes over time. Because things are constantly changing. The external environment has also changed.

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The theory of comparative advantage changes over time. Because things are constantly changing. The external environment has also changed.

Comparative advantage is subject to change, and there are many reasons for this change, the most important of which is the development of the economy itself, and countries at different stages of economic development have different comparative advantages.

For example, after the success of the October Revolution in 1918, Soviet Russia was a typical agricultural power, but through the construction of Lenin, Stalin, Khrushchev and others, by the 1960s, it had grown into an industrial power, and its economic pillar industries and advantageous industries had changed. The main cause of this change was the economic construction of Soviet Russia itself.

The theory of comparative advantage, which is the core of international theory, has been continuously deepened with the development of international theory. Different countries in the same era have different comparative advantages, and the comparative advantages of different eras also have different characteristics. Comparative advantage in the real economy is dynamic.

Developing countries should formulate economic policies in accordance with the changing trend of their comparative advantages, not only make use of their own comparative advantages, but also make use of advanced technologies suitable for their own countries, increase investment in human capital, and realize the transformation of their comparative advantages, so as to produce real international competitive advantages and enhance their industrial structure in the international economy. Key words: comparative advantage; human capital; International Competitive Advantage CLC Number Document Identification Code A Article Number 1000 - 5072 (2001)02 - 0038 - 05The theory of comparative advantage in international ** originated from the explanation of the reasons for the mutual relations between different countries. Since Ricardo founded the theory of comparative advantage, the theory of comparative advantage has always been the basic theory that guides the international division of labor and explains the international market.

With the continuous development of international practice, the factors that determine a country's comparative advantage have also evolved, and the theory of comparative advantage has also been developed and deepened. Studying the development and actual evolution of the theory of comparative advantage is of positive significance for developing countries to make use of and transform their own comparative advantages and to enhance their industrial structure in the international economic competition. 1. Adam Smith's absolute cost theory is the origin of the theory of comparative advantage.

Proceeding from the theory of the wealth of the product of labor, Smith believed that in order for a country to increase the product of labor, it must follow the path of division of labor. He took the theory of regional division of labor as the basis of his international theory and established the theory of absolute advantage. Smith believed that the exchange of goods at absolute low cost would increase the production of goods and increase the quantity of consumption, thereby benefiting both parties.

Smith's theory of absolute advantage has the limitation of making a direct comparison between the cost of a product at home and the cost of the same product abroad, and determining exports by the absolute cost of exports, which would prevent countries that are at an absolute disadvantage in the production of all products from participating in the international world. Breaking through the limitations of Smith's theory of absolute advantage is David Ricardo's theory of comparative advantage (or theory of comparative costs). The so-called comparative cost refers to the comparison of the cost ratio of different products in China with the cost ratio of similar products abroad, as long as there is a difference in the cost ratio, different countries can and will inevitably exchange with each other, and obtain economic benefits from it.

The theory of comparative advantage holds that no matter how a country's labour productivity differs from that of other countries, it is beneficial for a country not only to produce and export those products in which it has the greatest comparative advantage, but also to import those products in which it has the greatest comparative disadvantage.

Porter believes that the country's economic development can be divided into four stages, namely the production factor-oriented stage, the investment-oriented stage, the innovation-oriented stage and the wealth-oriented stage, of which the first three stages are the main forces for the development of the country's competitive advantage, which usually brings economic prosperity, and the fourth stage is the economic turning point, which may go downhill. The classical political economist Ricardo's theory of comparative cost laid the foundation for the modern international division of labor and international theory. The theory of national competitive advantage proposed by Porter is a transcendence of the theory of comparative advantage, and the comparison between the two has the following differences:

The premise is different: the theory of comparative advantage takes a perfectly competitive market as the theoretical premise, while the theory of competitive advantage takes the imperfectly competitive market as the theoretical premise, and the latter is more in line with the current reality than the former. The theory of comparative advantage only considers the international competitiveness of certain products or industries, and mainly compares the competitiveness of their costs.

The theory of competitive advantage compares a country's international competitiveness, that is, the level of development of productive forces, with that of other countries, and it also considers the potential comparison of interests in addition to the actual situation.

Different in nature: comparative advantage is a concept of relativity, and a country must have a comparative advantage in some areas and a comparative disadvantage in others. The logical consequence of this theory is that any country should be content with the status quo and maintain the status quo.

Because this makes it possible to profit the country with minimal cost. Competitive advantage is an absolute concept, a country is either in a competitive advantage, or in a competitive disadvantage, the boundaries are quite clear, there is no ambiguity. Any country must make great efforts to achieve or maintain a competitive advantage.

The traditional theory of comparative advantage holds that comparative advantage mainly depends on a country's initial conditions, which come from either natural causes or historical reasons, for example, if a country is economically backward, underdeveloped, and technologically inferior due to historical reasons, it can only produce and export mineral products and agricultural products according to the theory of comparative advantage, and is at a lower level in the international division of labor. The theory of competitive advantage believes that competitive advantage mainly depends on a country's innovation mechanism, and depends on the acquired efforts and enterprising spirit of enterprises. As long as it dares to innovate and competes aggressively, a backward country may also become a country with a competitive advantage.

Although there is a fundamental difference between comparative advantage and competitive advantage, at the same time they are also very closely related: comparative advantage is the basis of competitive advantage, and a country's comparative advantage in terms of production factors is conducive to its establishment of international competitive advantage, and the establishment of a country's international competitive advantage can obtain lasting comparative benefits. Comparative advantage is not necessarily the same as competitive advantage, but comparative advantage can be transformed into competitive advantage with the dynamic change of production factors.

Comparative advantage theory: reflects the difference in relative costs.

Before the comparative advantage was proposed, economists generally believed that if one country produced various goods more efficiently than another, the ** in between was inefficient for countries with high production efficiency;

The theory of comparative advantage clarifies that it is the relative labor efficiency that determines the overall welfare of the economic system, so no matter what the situation, as long as the existence of ** will improve the situation of both sides, this theory is now a strong pillar of the international ** supporters.

Look at the classic principles of economics, I'm a layman, I don't know so much.

Actually, the two are talking about the same thing. Wages and labor productivity here refer to the ratio of a(lc) to a(lw) and a*(lc) to a*(lw). The textbook should explain "comparative advantage in a multi-commodity model.""。

Wages were introduced here, because there are many commodities, so the wage rate cannot simply be labeled as the ratio of the productivity of the two commodities, but the monetary unit is introduced to measure the labor productivity of different commodities (i.e., wages, here labor productivity and wage rates are simplified into the same thing).

The comparative advantage of a sector depends not only on the labour productivity of its sector relative to the same sector in other countries, but also on the wages of the country relative to foreign countries. In layman's terms, although the labor productivity of commodity A is low and there is no absolute advantage, the cost of the workers of commodity A is also low (because it is assumed to be a single factor of labor, cost = wage), so if the ratio of productivity to wages is low, the country has a comparative advantage in commodity A.

I believe that the reason for this low percentage is due to the assumption in the textbooks that the labor force is fully employed and that labor can move freely in various industries.

This graph shows the number of x y products produced in countries A and B, i.e., A can produce 8 units of X and 4 units of Y per unit of time. In the same way, we can know the production situation in country B.

The absolute advantage is that the number of the same products produced per unit of time is always greater than that of another country. So according to the diagram you gave, you can know that country A has an advantage in both X and Y products, that is, it can produce more products at the same time, and country A has an absolute advantage in both products.

In this way, A has an advantage in both products, is it possible that A does not need **? Next, Ricardo proposed the theory of comparative advantage, showing that in this case, it is still possible to make both parties profitable.

Comparative advantage is the relative cost of producing two products in a country. Take the data in your graph as an example. A country produces 8 units of x per unit of time, and can also produce 4 units of y.

Then it can be said that in country A, the time to produce one unit of y can produce two units of x, i.e., y = 2x. Similarly, in country B it is y=4x. In this way, country A has a comparative advantage in y, while country B has a comparative advantage in x.

That is, country A specializes in producing Y and takes it to country B in exchange for product X (the cost of producing X in country B is relatively small, and the Y produced in country A can be exchanged for more X in country B), which has never improved the utility of both countries.