Author Question: The Ricardian proposition that international trade will benefit any country (gains from trade) as ... (Read 159 times)

cagreen833 · **on:** Jun 30, 2018

The Ricardian proposition that international trade will benefit any country (gains from trade) as long as the world terms of trade do not equal its autarkic relative prices is a straightforward and powerful concept.

Nevertheless, it is impossible to demonstrate empirically. Why?

Question 2

The experience of Chile's foreign sector in the last two decades of the 20th century supports the proposition that economic growth is supported by

A) import substitution.
B) industrialization policies.
C) trade liberalization policies.
D) intra-industry trading.
E) trade embargoes.

stano32 · **Reply #1 on:** Jun 30, 2018

Answer to Question 1

This is because there is no way of knowing exactly what are, or would have been, the autarky MRTs or MRSs. This is because there is no single example in the world of a country that is totally unengaged in international trade.

Answer to Question 2

C