Name one country that is self-sufficient in every aspect of precision manufacturing. USA? No. Germany? No. japan? No. There is no country. Any country that tries to be total self-sufficient will not remain advanced, or efficient, for very long. Not only will they not remain advanced if they try, their effort will fail.
The cold hard truth that every ignorant rabid nationalist and idiot protectionist will try to deny is Richardo’s Law of comparative advantage. Countries become advanced and efficient not by doing everything well. Countries become advanced and efficient not even by doing everything in which it enjoys some competitive advantage well. Cointries become advanced and efficient by doing well only select things in which the country enjoys the greatest advantage.
This is the fundamental reason why trade enriches the world and makes the pie bigger. The fundamental reason why trade enriches is it allows each partner to focus only on those things in which that partner enjoys the greatest comparative advantage. This allows all things to be done only by those who do that thing most efficiently and at the least overall cost.
The cold hard truth that every ignorant rabid nationalist and idiot protectionist will try to deny is Richardo’s Law of comparative advantage. Countries become advanced and efficient not by doing everything well. Countries become advanced and efficient not even by doing everything in which it enjoys some competitive advantage well. Cointries become advanced and efficient by doing well only select things in which the country enjoys the greatest advantage.
This is the fundamental reason why trade enriches the world and makes the pie bigger. The fundamental reason why trade enriches is it allows each partner to focus only on those things in which that partner enjoys the greatest comparative advantage. This allows all things to be done only by those who do that thing most efficiently and at the least overall cost.
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