Evaluate this statement. Developed countries have nothing to gain by trading with developing countries. Evaluate this statement. Compare and contrast the classical and HO theories of international trade. Italy is labor abundant.
Shoes are labor intensive and wheat is capital intensive.
Be sure to identify which country has comparative advantage in which good. Which factors gain and which lose when trade is opened between two countries. Explain why as countries become more dissimilar in their factor endowments, that they move closer to complete specialization.