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Technological Improvements and Comparative Advantage Reconsidered

Author

Listed:
  • Yochanan Shachmurove

    () (The City College of The City University of New York and Department of Economics, the University of Pennsylvania)

  • Uriel Spiegel

    () (Department of Economics, University of Pennsylvania and Department of Economics, Bar Ilan University)

Abstract

Given a world consisting of two countries, two commodities, and two consumers, this paper analyzes the potential effects of the current global trend of shifting world productions with regards to consumer goods. When technological improvements occur in a developing country, would terms of trade remain favorable for a developed country? Would both countries benefit? Instances where one or both countries benefit are feasible. However the developed country may lose as a result of an improvement in the production of the good that previously had been exported by the developed country.

Suggested Citation

  • Yochanan Shachmurove & Uriel Spiegel, 2006. "Technological Improvements and Comparative Advantage Reconsidered," PIER Working Paper Archive 06-023, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
  • Handle: RePEc:pen:papers:06-023
    as

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    File URL: https://economics.sas.upenn.edu/sites/default/files/filevault/working-papers/06-023.pdf
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    References listed on IDEAS

    as
    1. Paul A. Samuelson, 2004. "Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization," Journal of Economic Perspectives, American Economic Association, vol. 18(3), pages 135-146, Summer.
    2. F. Gerard Adams & Byron Gangnes & Yochanan Shachmurove, 2006. "Why is China so Competitive? Measuring and Explaining China's Competitiveness," The World Economy, Wiley Blackwell, vol. 29(2), pages 95-122, February.
    3. repec:fth:michin:323 is not listed on IDEAS
    4. Johnson, George E & Stafford, Frank P, 1993. "International Competition and Real Wages," American Economic Review, American Economic Association, vol. 83(2), pages 127-130, May.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    International trade; Samuelson; autarky equilibrium; comparative advantage; endowment shock;

    JEL classification:

    • F0 - International Economics - - General
    • F1 - International Economics - - Trade
    • O - Economic Development, Innovation, Technological Change, and Growth
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies

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