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Introduction: Since David Ricardo first illustrated the theory of comparative advantage in the early 19 century. He solved a problem that had eluded Adam Smith. Comparative advantage explains why a country might produce and export something its citizens don't seem very skilled at producing when compared directly to the citizens of another country. The explanation of the apparent paradox is that the citizens of the importing country must be better at producing something else, making it worth it for them to pay to have work done by the exporting country. Amazingly, the citizens of each country are better off specializing in producing only the goods at which they have a comparative advantage, even if one country has an absolute advantage at producing each item. Although most models and theories of trade suggest that some people would benefit and some lose from free trade, the Ricardian model shows that everyone could benefit...

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