Trade
Comparative Advantage
Also known as: Ricardian advantage, Relative advantage
An economic principle stating that a country should specialize in producing and exporting goods where it has a lower opportunity cost than other countries.
Also known as: Ricardian advantage, Relative advantage
An economic principle stating that a country should specialize in producing and exporting goods where it has a lower opportunity cost than other countries.
Comparative advantage is a fundamental principle of international trade formulated by David Ricardo. It states that each country should produce and export goods where it has a lower relative opportunity cost, and import goods where other countries are relatively more efficient.
Free Trade Agreement (FTA)
International agreement that eliminates or reduces tariffs and trade barriers between signatory countries.
TradeTrade Balance
An economic indicator recording the difference between the value of a country's exports and imports of goods during a determined period.
TradeDefinitive Export
Customs regime allowing goods to leave the country to remain abroad indefinitely.
TradeUSMCA (T-MEC)
Trade agreement between the United States, Mexico, and Canada that replaced NAFTA in July 2020, governing trade, investment, and intellectual property rules.