Trade Lesson 2 Ethical Issue Activity
Trade Lesson 2 Ethical Issue Activity

Time: 20 minutes
Skills: Holistic Thinking
Objectives 2 and 3
Related Resources:
- Globalization Ain’t All Bad, Really!. (2010, November 16) Managing Gods Money. Retrieved from:  http://managinggodsmoney.com/wordpress/?tag=comparative-advantage

This activity is to be used for both models of comparative advantage (Ricardian and Heckscher-Ohlin models). The concept of comparative advantage seems like straight-forward economic concept. A country is said to have a comparative advantage in whichever good has the lowest opportunity cost. That is, it has a comparative advantage in whichever good it sacrifices the least to produce.

The everyday choices that we make are, without exception, made at the expense of pursuing one or several other choices. When you decide what to wear, what to eat for dinner, or what to do on Saturday night, you are making a choice that essentially denies you the opportunity to explore any other options. The same holds true for individuals, companies, or countries producing goods and services.

Students should research the major exports of a developing country and answer the following questions:

  • What are these countries major exports and/or products?
  • Who are the long-term and short- term benefits and disadvantages of pursing these industries?
  • What are the land and labor constraints on these industries? How should these constraints inform government policy for developing certain industries?
  • What impact do these industries have on the environment, health care, education, politics, etc?

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