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If U.S. workers are more productive than Mexican workers in every good and service, will the U.S. be hurt by trade with Mexico?


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#1 Murphy

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Posted 08 September 2005 - 08:40 PM

If U.S. workers are more productive than Mexican workers in every good and service, will the U.S. be hurt by trade with Mexico?

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Posted 12 August 2008 - 09:06 AM

Again, feeding off the idea of comparative advantage, by specializing the US will still gain an advantage by doing what they are best at and letting the Mexicans do the same. There is also another advantage here, by Mexicans working at their best they will buy those we are best at, but also other products as well.

#3 Murphy

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Posted 02 November 2008 - 05:21 PM

View PostMart Grams, on Aug 12 2008, 08:06 AM, said:

Again, feeding off the idea of comparative advantage, by specializing the US will still gain an advantage by doing what they are best at and letting the Mexicans do the same. There is also another advantage here, by Mexicans working at their best they will buy those we are best at, but also other products as well.

The first sentence is right, but I'm not sure about the second one. I think at best you are just double-counting the benefits of comparative advantage. :)

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Posted 08 November 2008 - 12:14 PM

View PostMurphy, on Nov 2 2008, 04:21 PM, said:

The first sentence is right, but I'm not sure about the second one. I think at best you are just double-counting the benefits of comparative advantage. :)

Isn't that what socialist economists do........I may need a job at some Eatern college!!!! :lol:

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Posted 20 December 2010 - 03:59 AM

But should we take scarcity into account as well? When A keep producing the thing he's good at, I think it might be incorrect just by times the quantity produced against price, because price will drop due to decrease in scarcity. So the case would also make sense if A produces two products and A's total revenue is higher than him producing a single product only. So I guess it all depends on profit, and not merely comparative advantage?

I'm not sure, help me out guys





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