Ricardo

Abstract

Ricardo as you will have read was a very smart man. He developed the first model of trade that affected the discussion of international trade from 1820 to the present day. Crucial predictions of his model are about the circumstances that give rise to the pattern of trade who imports one good and exports another; the pattern of specialization in production; and the sources of wealth or income. Two ideas that have become commonplaces in both professional and popular literature first arise in Ricardo: comparative advantage and absolute advantage. While frequently abused in popular discussion you will learn about them more systematically.