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The theory of comparative advantage should really be dubbed the theory of static comparative advantage to highlight where it fucked up. If China believed in it
by pydry 1y ago
The theory of comparative advantage should really be dubbed the theory of static comparative advantage to highlight where it fucked up.
If China believed in it theyd still be making cheap plastic tat. If the west hadnt believed in it China's industrial rise probably wouldnt have been quite so shocking - 90s/00s neolib economists thought China was shooting itself in the foot.
- AstralStorm 1y agoActually they still are making that. And now advanced expensive stuff nowadays too. After all, it's easier to further an already existing advantage.
- pydry 1y agoshrug and the theory of static comparative advantage said that by trying to move up the value chain they were shooting themselves in the foot. It sounds stupid, but so do many intellectual fashions of a bygone era.