Comments on: Comparative Advantages in Business

By: Beatrice Tangie

Beatrice Tangie — Tue, 18 Mar 2008 18:00:33 +0000

comperative advantage is good because it allows countries, companies and individuals to specialize in the goods they can produce at the cheapest cost.Without comperative advantage, companies will not make enough profits as they will waste time producing even the goods thatare costly to produce in terms of time, money and resources.

By: Chris Tingom

Chris Tingom — Thu, 09 Feb 2006 23:59:37 +0000

I really like the opportunity cost description on the Wikipedia.

http://en.wikipedia.org/wiki/Opportunity_cost

Thanks for pointing that out! It’s really good stuff and something that I think about all the time.

What’s the best use of my time? That’s where it comes down to the dollars. Good stuff.

By: TOMAS

TOMAS — Thu, 09 Feb 2006 23:00:09 +0000

Chris – Nice write up. The theory of comparative advantage sounds very similar to the theory of opportunity costs – with the exception that it is geared towards a macroeconomic business situation rather than a general situation.

BTW, it is never a bad idea to indulge in something outside your field if it brings you personal satisfaction – that is until it begins to hinder your company’s productivity.

By: Chris Tingom

Chris Tingom — Thu, 09 Feb 2006 18:37:12 +0000

I know that and that’s a good point (the individual benefit) however it applies in a number of ways.

This is exactly why companies come to us to buy a web site. We’re good at it and they aren’t even though they could make one if they spent a lot of time at it. When they hire us they get a better product and we free them up to make money the way they do it best.

By: Ben Eastaugh

Ben Eastaugh — Thu, 09 Feb 2006 18:23:13 +0000

Specialisation may be good for the economy, but I think it means we lose something as individuals. The economist gets more out of building the deck himself than merely getting the deck built, which would be the case if he simply hired someone to do it for him.