EconPapers    
Economics at your fingertips  
 

Comparative Advantage and the Labor Theory of Value

Jorge Morales Meoqui

History of Political Economy, 2011, vol. 43, issue 4, 743-763

Abstract: With the famous numerical example of chapter 7 of the Principles (1817) David Ricardo intended to illustrate first and foremost the new proposition that his labor theory of value does not regulate the price of international transactions when the factors of production are immobile between countries. Unfortunately, later scholars have often omitted this proposition when referring to Ricardo's numerical example. Instead, they have highlighted only the comparative-advantage proposition, although Ricardo considered it as a corollary of the omitted proposition and therefore inextricably linked to it. This inexplicable omission has led to an incomplete understanding of the logical construction of Ricardo's numerical example, as well as to the misinterpretation of the four numbers as unitary labor costs. With an accurate understanding of Ricardo's numerical example and the logical relationship between the two propositions it meant to prove, it is relatively easy to refute the main objections that have been raised against the very same numerical example in the past. Moreover, it reaffirms the sustained relevance of Ricardo's two propositions as important insights for understanding the current process of economic globalization.

Keywords: David Ricardo; comparative advantage; labor theory of value (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
http://hope.dukejournals.org/content/43/4/743.full.pdf+html link to full text (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Comparative advantage and the labor theory of value (2010) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hop:hopeec:v:43:y:2011:i:4:p:743-763

Access Statistics for this article

History of Political Economy is currently edited by Kevin D. Hoover

More articles in History of Political Economy from Duke University Press Duke University Press 905 W. Main Street, Suite 18B Durham, NC 27701.
Bibliographic data for series maintained by Center for the History of Political Economy Webmaster ().

 
Page updated 2025-03-22
Handle: RePEc:hop:hopeec:v:43:y:2011:i:4:p:743-763