Gas Prices are Why Comparative Advantage is a Dumbass Concept to Applaud

[Forogil]

1. Comparative Advantage (Skip if you know what it is)

In Economics, Comparative Advantage is the description of a state where a producer can experience decreased opportunity cost for the production of a good or service relative to others. The classic example is guns and butter.

No, it's not.

The classic example from Ricardo was wine and cloth, I have also seen wheat and cloth used as example.

Guns&butter is used by http://econport.gsu.edu/content/hand...Advantage.html - but in contrast to other comparisons it seems weird (or basically Sloman had better examples than Coleman). First and foremost butter is consumed whereas guns aren't in a similar way. And the prices also differ - a new gun seems to cost 200$ or more, a pound of butter allegedly 3$-8$; indicating a larger difference in production costs than the example assumes.

Additionally it's not clear why one country would have an advantage in one or the other; the wine and cloth example was clearer on that side, especially when it was written, and currently out-sourcing labor-intensive work to China is similarly obvious.

[xChurch]

So...America first?

[Logwyn]

Is the Petroleum industry a cartel really though?