The theory of absolute advantages of Adam Smith
The real wealth of the country consists of goods and services available to its citizens. If any country can produce a particular commodity, more and more cheaply than other countries, it has an absolute advantage. Some countries can produce goods more efficiently than others. Resources countries spill over into profitable industries, as the country can not compete in unprofitable sectors. This leads to increased productivity of the country, as well as workforce skills, lengthy periods of production of similar products provided impetus for a more efficient working methods. Natural advantages:
1.Climate;
2.Area;
3.Resources.
Acquired advantages:
1.Production technology, ie the ability to produce various products.