Define comparative advantage correctly

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Reference no: EM133717404

Problem

"By means of glasses, hotbeds, and hotwalls, very good grapes can be raised in Scotland, and very good wine too can be made of them at about thirty times the expense for which at least equally good can be brought from foreign countries. Would it be a reasonable law to prohibit the importation of all foreign wines, merely to encourage the making of claret and burgundy in Scotland?" Explain this comment in terms of comparative advantage, making sure to define comparative advantage and to identify an international trade pattern he would likely have endorsed with his product example. To be clear, you have to (i) define comparative advantage correctly and (ii) correctly state if Adam Smith was pro-free trade policies or pro-protectionist policies.

Reference no: EM133717404

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