POLS 3313 Lecture Notes - Lecture 15: Factor Endowment, Free Trade, Consumer Protection
15 Oct 2018
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Document Summary
17th century: dutch republic becomes an economic powerhouse. Constitutional monarchy under kind willem-alexander and prime minister mark rutte (vvd). About half of the country is less than one meter above sea level. Fixed what we pay no matter how much we produce. I will need these tools regardless of how much i am producing. Hiring people for shortcuts to obtain certain things. Other people who are already growing things give us a little of it. Absolute advantage ability to produce more of a good or service than other countries, using the same amount of resources. Comparative advantage ability to produce a particular good more e ciently than other goods or services. Specialization makes use of comparative rather than absolute advantage. States should produce according to their comparative advantage. Heckscher-ohlin model comparative advantage is determined by factor endowments. How much you can produce from what you have. Large populations tend to have a lot of labor.
