Producing two goods rice and cloth

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Question

Consider the Ricardian model taught in the class with only two countries in the world, China and Singapore, producing two goods Rice and Cloth. China has comparative advantage in Cloth and Singapore in Rice. Ricardian model says they should specialize according to their comparative advantage. Why China may not follow such a rule, while for Singapore it is not a concern?

Reference no: EM132335864

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