Due to a better understanding of the logical interrelationships between the comparative- advantage proposition, the classical rule of specialization and the proposition regarding the non- appliance of the labor theory of value in international exchanges in Ricardo’s famous numerical example in...

With the famous numerical example of chapter 7 of the Principles 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....

This is an entry produced for the Elgar Companion to David Ricardo, edited by Heinz D. Kurz and Neri Salvadori. Cheltenham, UK and Northampton, MA, USA: Edward Elgar, forthcoming.