Question: In the same applecomputer trade example given in Section 19.5, suppose that because of technology transfer, the South becomes just as productive as the North
(a) Autarky: Redo Table 19.3 to reflect this change. Assume the other parameter values are unchanged.
(b) Free trade: Do the same thing for Table 19.4.
(c) Discuss the differences: How do the gains from trade change? Who benefits from the improvement in technology in the South?
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a Autarky b Trade c Now the rise in apple productivity means that workers in North and South both ge... View full answer
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