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I see I think there's a deeper subtlety I'm not quite grasping. When you provide a fixed production level for a given resource, it makes a lot more sense, but w

I see I think there's a deeper subtlety I'm not quite grasping. When you provide a fixed production level for a given resource, it makes a lot more sense, but what forces there to be a fixed level of cloth but a floating level for wine? At first I was thinking that there will be a certain demand level for a good, and the supply will shift to meet it fixing a price for the good. However, who's to say that just because there's more (potential) supply more wine will necessarily be produced? Couldn't those remaining people just be unemployed?

lambertsimnel 11y ago
I realise I don't understand it as well as I thought I did. How about variable outputs of any commodity and countries taking any opportunity they can to increase consumption by replacing domestic production of a commodity with foreign production bought with the proceeds of extra production of another commodity for export. No country would benefit from producing so much that it put all foreign industry out of business; nobody exports anything except in exchange for something (imports).