Developing Countries Must Take Advantage of the International Trading System

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The ambition of every country is to improve the current conditions in which they live. It is the consensus of most scholars and policymakers that the best strategy for a poor country to improve is to develop and take advantage of international trade (228). In addition to the internal issues of poor infrastructure, inadequate education and corruption, developing countries don't believe that the current international trading system, which is based on the principle of comparative advantage, is relevant for them (263). Developing countries are skeptical of the comparative-advantage principle and free trade for a few major reasons. These are: unstable export markets, worsening terms of trade and limited access to markets of industrialized countries (229). "The theory of comparative advantage maintains that all nations can enjoy the benefits of free trade if they specialize in production of those goods in which they have a comparative advantage and exchange some of them for goods produced by other nations" (229). Developing countries tend to export a limited number of primary good...

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