Conference Paper

In international trade, countries should use their relative comparative advantages. They should specialize in production and export of goods and services that compete with a lower relative cost of production in other countries and to exchange those products for other products for which home manufacturing would be more expensive. That is the theory of David Ricardo, one of the founders of classical political economy. Although it is set back in 1817, today that theory forms the basis for explaining the benefits of international trade, i.e. the incentives and motives of national economies to trade with each other. At its core lies the model of perfect competition. This model is the basis for today's advocacy for free trade within the EU, trade with no tariffs and no other restrictions. The end result