Dynamic comparative advantage theory ?
Correct answer: A. helps explain why some nations use industrial policy to support potentially competitive new firms
- A. helps explain why some nations use industrial policy to support potentially competitive new firms
- B. cannot explain strategic competition between firms such as Boeing and Airbus
- C. Is another name for Ricardo's comparative advantage theory?
- D. None of the above
Explanation
Dynamic comparative advantage concerns how countries can develop new competitive industries over time, often through industrial policy and support for infant industries. It is distinct from Ricardo's static comparative advantage theory.
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