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To: CobaltBlue
If there is no higher math involved, there is nothing to this and nothing to understand. Can't we have even just a couple of simultaneous differential or integral equations? The second link was a beginning, but devolved to those notorious economics linear graphs.
214 posted on 03/22/2004 3:31:34 PM PST by RightWhale (Theorems link concepts; proofs establish links)
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To: RightWhale
Real economists use more complex math models. The term to search is "dynamic comparative advantage." Classic Ricardo is called "static comparative advantage."
215 posted on 03/22/2004 3:54:54 PM PST by CobaltBlue
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To: RightWhale
Can't we have even just a couple of simultaneous differential or integral equations?

Ricardo's economic logic is essentially a precursor to optimization theories such as linear programming and the simplex method.

Don't be misled by his use of nations in his examples. David Ricardo was basicly an investment banker/stock broker who had little concern for what benefited either nation. His theory can be summarized as: "Maximize profits (the objective function) by minimizing inputs (the constraints -- labor, capital, etc.)" He did so by pitting one nation against each other to drive all inputs down to the commodity level.

It's a great theory for corporations engaged in transnational trade.
But that doesn't make it the best policy for a nation to pursue for the benefit of it's own citizenry. Actually, it's quite a darwinian abomination.

221 posted on 03/22/2004 4:35:00 PM PST by Willie Green (Go Pat Go!!!)
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