The question here is whether the dynamic effects of opening to trade will increase or decrease comparative advantage. When comparative advantage is based on the abundance or scarcity of something that is costly to acquire, one expects rational behavior to respond to a change in prices by...

When there are costs of trade, such as transport or other costs, the pattern of trade may not be well described by the usual measures of comparative advantage, which simply compare a country's costs or autarky prices to those of the world. Instead, a better comparison takes into account the...