P/E/183. WTO and comparative advantage in international trade

The paper relates to international trade discussing the theory of comparative advantage that is dominated by large countries but benefits small countries as well. The overview of theories in international trade beginning with David Ricardo is given. The paper demonstrates how large and small countries relate within a trading system giving an the example of cheese and wine trade between France and Switzerland. The author analyses the benefits that the emergence of World Trade Organisation (WTO) bought about, but argues that the rules of WTO are often designed by the °western governments and do not always work well for the rest of the world.