| Publication |
2014.
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| Summary/Abstract |
Classical free trade theory, which originates from Adam Smith's and David Ricardo's theory of comparative advantage, claims that countries specialize in an export what they are relatively good at producing, and they import what they cannot produce sufficiently. Since for example the climate in Germany does not allow for the production of coffee ant since the infrastructure and the technological advancement for the manufacturing of car is not developed in Bolivia, both countries benefits from opening their markets for mutual trade. In theory, free trade is a win-win Situation which everyone benefits.
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