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Source: Question 9b, p 61, Principles of Microeconomics, 7 Ed, 2014, by N Gregory Mankiw
= Question 8b in Principles of Microeconomics, 4 Ed, 2008

9. Are the following statements true or false? Explain in each case.
b. “Certain very talented people have a comparative advantage in everything they do.”

Answer: b. False; it is not true that some people have a comparative advantage in everything they do. In fact, no one can have a comparative advantage in everything. Comparative advantage reflects the opportunity cost of one good or activity in terms of another. If you have a comparative advantage in one thing, you must have a comparative disadvantage in the other thing.

This question of Mankiw recommends my own version: (Abbreviate comparative advantage as CA)

Can people have neither a comparative advantage nor a comparative disadvantage in everything they do?

My lay guess is: yes. For example, suppose in a 3-person economy: person A's CA is cooking and person B's foraging, and person C does nothing. Then person C exemplifies such a person?

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2 Answers 2

Comparative advantage doesn't work like that.

If person A's CA is cooking, person C has a comparative advantage in foraging. With B, C has a comparative advantage in cooking.

It's not possible to have a comparative advantage or comparative disadvantage in everything: If you were better at everything than someone else, you would have an absolute advantage. As soon as two people have different skills for anything, they have a comparative advantage of some kind.

It is possible for two people to have no comparative advantage/disadvantages whatsoever: If both people are exactly equal at everything they can do, then there is no comparative advantage or disadvantage between them at all.

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In the three person economy, if all three people are equally good at cooking and foraging then they have neither absolute nor comparative advantages. But that's unlikely to be an economically important situation in a real economy with many jobs to do and many forms of skill and ability.

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