Discussion response to peers
Please focus just on respond to peers, not need for initial post
USE THIS REFERENCE
Mankiw, N. G. (2021). Principles of Economics. 9th Ed. Cengage.
The United States has a comparative advantage over China on the production of specialized and capital-intensive labor. It also has a comparative advantage in the production of services, such as travel and tourism.
For this discussion, first play these simulation games in the MindTap environment:
- Comparative Advantage (Without Trade)
- Comparative Advantage (With Trade)
In your initial post, share your experience playing the games, and include an image of one of your simulation reports. (See Module Two Simulation Discussion Screenshot Instructions PDF.) Then address the following:
- Countries trade goods just like the food trucks do in the simulation. Did the food trucks benefit from specialization and trade? How can the United States benefit from specialization and trade? Provide examples from the textbook.
- Research and share a current news article on international trade that supports the argument economists make in favor of free trade agreements (FTAs). In what ways is the article supportive of FTAs?
In your responses, comment on at least two of your peers’ posts. Critique the arguments made in each peer’s article by weighing the costs of FTAs against the benefits. Support your position with sources from the news or the textbook.
The food trucks did benefit from specialization and trade. While playing the simulation I realized if I traded with my partner I would be doing less work but still benefiting from the profit. By splitting up our work we got the same amount done and received the same profit we would if done by ourselves.
Chapter 3 gives an example with Ruby and Frank,
“We can both benefit because trade allows each of us to specialize in doing what we do best. You will spend more time growing potatoes and less time raising cattle. I will spend more time raising cattle and less time growing potatoes. As a result of specialization and trade, each of us can consume more meat and more potatoes without working any more hours.”
This proves that with trade, you can focus on what you are best at and spend less time on something you aren’t as good at.
The article I researched tells us how trade has benefitted the economy,
“Then there are trade’s overall benefits for the economy. A 2017 Peterson Institute paper calculated the payoff to the United States from expanded trade between 1950 and 2016 to be $2.1 trillion, increasing U.S. GDP per capita and per household by around $7,000 and $18,000 — with benefits, again, disproportionately accruing to households in the bottom income decile.” (Lincicome, 2019)
Mankiw, N.G. (2021). Principles of economics (Ninth ed.). Boston, MA: Cengage
Lincicome, S. (2019). The Case for Free Trade. Cato.org. Retrieved July 7, 2022, from https://www.cato.org/commentary/case-free-trade.
With trade I was able to produce 84 combos the first round and 85 combos the second round.
Overall, I enjoyed having the simulations. I liked having the hands-on experience to get some vision of the topics. I wasn’t able to access the report to submit because for some reason my screen for the simulation isn’t big enough to reach the result button.
The foods trucks did benefit from specialization and trades. Any producer in the United States can benefit from specialization and trade. Chapter 3 in the webtext says, “When each person specializes in producing the good in which he or she has a comparative advantage, total production in the economy rises” (Mankiw, 2022). Many of the goods that are sold here in American are produced abroad, and many of the goods produced in the United States are sold abroad. An example from the webtext regards trading food and cars between the United States and Japan. The United States has better land to produce food than Japan, but produce the same amount of cars. Each good should be produced by the country that has the lower opportunity cost of producing that good. Japan should produce more cars than it wants for its own use and export some of them to the United States. While The United States should produce more food than it wants to consume and export some to Japan. Both Countries can enjoy more of both products.
Mankiw. (n.d.). Interdependence and the Gains from Trade. MindTap – Cengage Learning. Retrieved July 6, 2022, from https://ng.cengage.com/static/nb/ui/evo/index.html?deploymentId=5981412353502464190243042516&eISBN=9780357133576&id=1502080777&snapshotId=2965576