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Absolute advantage |
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Absolute advantageThe ability to produce a good at lower cost, in terms of real resources, than another country. In a Ricardian model, cost is in term of only labor. Absolute advantage is neither necessary nor sufficient for a country to export a good. See comparative advantage.Absolute advantageA person, company or country has an absolute advantage if its output per unit of input of all goods and services produced is higher than that of another person, company or country.Absolute advantage Similar MatchesRevealed comparative advantageRevealed comparative advantageBalassa's (1965) measure of relative export performance by country and industry, defined as a country's share of world exports of a good divided by its share of total world exports. The index for country i good j is RCAij = 100(Xij /Xwj)/(Xit /Xwt) where Xab is exports by country a (w=world) of good b (t=total for all goods). Competitive advantageCompetitive advantageCompetitiveness. Contrasts with comparative advantage. First mover advantageFirst mover advantageThe advantage that a firm or country may derive from being the first to enter a market, or from being the first to use a new technology, advertising technique, etc. Yield advantageYield advantageThe advantage gained by purchasing convertible securities instead of common stock, which equals the difference between the rates of return of the convertible security and the common shares. Locational advantageLocational advantageAny reason for a firm to locate production, or a stage of production, in a particular place, such as availability of a natural resource, transport cost, or barriers to trade. May explain why a country's firms succeed in trade, or why a multinational firm locates there. Further SuggestionsChain of comparative advantageDynamic comparative advantage Production Cost Advantage Advantage Location specific advantages Distribution Cost Advantage Net advantage to merging Cost advantage Net advantage to leasing Comparative advantage Net advantage of refunding Kaleidoscope comparative advantage Comparative advantage Law of Comparative Advantage |
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