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The countries resources would therefore shift towards these industries and improve their efficiency through specialization. The labour force would also become more efficient from repeating the same tasks and developing more efficient working methods. Comparative advantage is a step further than absolute advantage theory. David Ricardo in 1817 developed comparative advantage to show there were ‘still benefits to be gained from trade if a single country were more efficient at both products’ .
Country size theory assesses how the size of a country affects the extent to which international trade patterns affect it...
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