POLSCI 160 Chapter Notes - Chapter Chapter 7 Vocab: General Agreement On Tariffs And Trade, World Trade Organization, Protectionism

• School: U of M
• Department: Political Science
• Course: POLSCI 160
• Professor: Barbara Koremenos

Document Summary

Comparative advantage: the ability of a country or firm to produce a particular good or service more efficiently than other goods or services such that its resources are most efficiently employed in this activity. The comparison is to the efficiency of other economic activities the actor might undertake, not to the efficiency of other countries or firms. Absolute advantage: the ability of a country or firm to produce more of a particular good or service than other countries or firms using the same amount of resources. Heckscher-ohlin trade theory: the theory that a country will export goods that make intensive use of the factors of production in which it is well endowed. Thus, a labor-rich country will export goods that make intensive use of labor. Protectionism: the imposition of barriers to restrict imports. Trade barriers: government limitations on the international exchange of goods.