The General Validity of the Law of Comparative Advantage

@article{Deardorff1980TheGV,
  title={The General Validity of the Law of Comparative Advantage},
  author={Alan V. Deardorff},
  journal={Journal of Political Economy},
  year={1980},
  volume={88},
  pages={941 - 957}
}
It is well known that the law of comparative advantage breaks down when applied to individual commodities or pairs of commodities in a many-commodity world. This paper shows that the law is nonetheless valid if restated in terms of averages across all commodities. Specifically, a theorem and several corollaries are derived which establish correlations between vectors of trade and vectors containing relative-autarky-price measures of comparative advantage. These results are proven in a general… Expand
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