Comments on “ Comparative Advantage: The Silver Bullet of Industrial Policy” by Justin Lin and Célestin Monga

Ha-Joon Chang
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Ha-Joon Chang: University of Cambridge

Chapter 1.2 in The Industrial Policy Revolution I, 2013, pp 39-42 from Palgrave Macmillan

Abstract: Abstract This is an excellent paper, making a powerful and comprehensive case for what is one of the few things in economics that is more than common sense dressed up in technical language. Despite its central position in the mainstream trade theory, the concept of comparative advantage is often misunderstood. I’ve even occasionally heard well-established economists (hopefully in a moment of sloppiness) saying things like, “Oh, such and such poor country does not have comparative advantage in anything,” which is a logical impossibility, as all countries have to have comparative advantage in some things. Lin and Monga make important contribution through this paper not only by reasserting the importance of this key concept but also by trying to operationalize the concept in a way that is very useful in real-world policymaking.

Keywords: Comparative Advantage; Latin American Country; Industrial Policy; Technological Capability; Factor Endowment (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:pal:intecp:978-1-137-33517-3_3

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DOI: 10.1057/9781137335173_3

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