© Leonie Woods

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Specification:

  • Comparative advantage, specialization

Click to read the article below and then answer the questions:

Adam Posen: ‘Russia and North Korea worked hard to be self-sufficient, it has not turned out well for them’

  • What is comparative advantage? How do national industrial policies ignore the principle of comparative advantage?

  • What is a zero sum industrial policy? How does it compare to a positive sum industrial policy? 

  • How has cross-border trade in the past affected developing economies? How has the change in industrial policy affected these countries?

  • What are some examples of subsides working? What are some examples of subsidies undermining their goal?

Ariel Slonim at MRU Econinbox

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