robinson crusoe – Karthik Shashidhar

arbit, business, economics, work 3 trees, catching fish, chopping trees, chopping wood, colleagues, competitive advantage, fishing, international trade, intuitive answer, job, law of comparative advantage, logs, opportunity cost, productive activities, productivity, robinson crusoe

Comparative advantage and competitive advantage

June 20, 2011

So there are two reasons why you could be employed. Comparative advantage and competitive advantage. Let me explain. In international trade, there is a concept called “law of comparative advantage“. Let me explain with the classical (and simple) example. Robinson Crusoe is marooned on an island with Friday. Now, let us assume there are two…