You could read this short essay or read this graf-summary. Seems that Ricardo, the theorist behind "comparative advantage" knew that the theory was BS under two circumstances.
... David Ricardo understood that comparative advantage, while an elegant theory, does not always apply. Specifically, it does not apply when buying goods with assets or debts, and it does not apply when capital is mobile. Given that both of these conditions are true today, it baffles me that supposed “experts” like Peter Schiff trot out this dead horse....
In this century, asset/debt purchases and capital mobility are the norm. Also, even in Ricardo's century (19th), it was expected that patriotic capitalists would not screw their countrymen by relocating their jobs to Lower Cost Noplaces.
Surprise!! Today's Wall Street Boyzzzz are not patriotic.
Any questions, class??
1 comment:
Capitalism and patriotism don't mix. Hence, the need for strict regulations and strong unions to curb the natural desire by business owners to make profits at the expense of the nation. You should know this by now.
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