Debunkin the Advantages of Free Trade: Comparative Advantage

maurizio13 SG

In all Economic books, they always advocate Free Trade based on the theory of Comparative Advantage.

In such a situation, it's beneficial to engage in Free Trade as the quantities produced for computers and apples, will far exceed what both countries would produce if they had decided to produce at their own combination of both products. This is irregardless of the country's efficiency in production, whether you are efficient or inefficient, you tend to gain from Free Trade.

maurizio13 SG

But we know that we can't produce our products indefinitely, to whatever quantities we want. So what if the world demand and supply for both computers and apples has an equilibrium quantity.

So is Free Trade really beneficial for all participants?

If the world demand has an equilibrium, it's only beneficial to efficient countries.