3 ms·
This is only true if the bar is rising at a pace regardless of increase in participants. In reality, increases in trade raises the bar faster for everyone, oft
by papersmith 17y ago
This is only true if the bar is rising at a pace regardless of increase in participants.
In reality, increases in trade raises the bar faster for everyone, often so much that it offsets the drop from the increased competition.
So say both country A and country B are increasing at 10 moon units per year. Country B trades as a net exporter with country A, and takes 1 moon unit per year from country A. However, the increase in economic activity boosts 2 moon units per year for everyone. Now country A is increasing at 11 moon units per year, and country B is increasing at 13 units per year.