Answer to Question #100826 in Macroeconomics for Ali khan

Question

Relate Ricardo’s position on the corn laws to his (a) theory of distribution and (b) theory of comparative costs?

Answer 1

A)In his theory of distribution, Richardo argued that as more and more resources are combined in production with a fixed resource, the additions to output will diminish

B)In his theory of comparative costs,he argued for free trade and formulated the idea that a country that trades for products it can get at lower cost from another country is better off than if it had made the products at home. This is the comparative advantage