The conversation between human and AI assistant.
What is the most relevant international trade economics theory?
Can you give me an example of comparative advantage in action?
Sure, an example of comparative advantage in action is the manufacturing of cotton textiles in England and the production of wool in Portugal. Although both countries could produce both goods, England was able to produce cotton textiles more efficiently, while Portugal had a comparative advantage in producing wool. By specializing in these goods and then trading with each other, both countries were able to increase their overall economic output and benefit from the exchange.