5 ms·

Wasn't David Ricardo with his "Comparative Advantages" theory ?

• yxhuvud 15y ago
  Yes, a very large part of it comes from Ricardo. However, theory before Krugman was mostly limited to belief that the main gain from globalization was from trade between countries with capital and those with cheap labour. Krugman took it one step (actually there was even more people in between pushing the theory forward, as Hecksher and Ohlin) further and his point was that economies of scale will make it beneficial also for economies of similar development level to trade with each other.