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by rahimnathwani 3627 days ago
"This seems slightly off to me."

You are correct. GP gave an example of absolute advantage. But Ricardo is more famous for demonstrating that comparative advantage can be enough to make trade worthwhile.

Your field may be 1/3 as efficient at making cotton than mine. But perhaps it's 1/5 as efficient as mine in growing olives. So, assuming we both want cotton and olives, it would be worth you growing more cotton, and swapping for some of my olives. I get a little more cotton than I would have alone. And you get a few more olives than you would have.