Factors that Cause Differences in Comparative Advantage

The following points highlight the nine main factors that cause differences in comparative advantage. The factors are: 1. Geographic Diversity 2. Tradition 3. Productivity Differences 4. Technology 5. Factor Abundance 6. Human Skills 7. Product Life Cycles 8. Preferences 9. Intra Trade. Factor # 1. Geographic Diversity: One key factor is geographic diversity, that is, differences in the climate and [...]