Can a country have both absolute and comparative advantage? (2024)

Yes, it is possible for a country to have both an absolute and comparative advantage. However, this would only be possible with one good because:

• A comparative advantage only exists when a country can produce a good at a lower opportunity cost when compared to alternatives and other countries. This exclusionary nature means it's not possible for a country to have a comparative advantage for all of the goods they produce.

• On the other hand, a country can have an absolute advantage in producing all goods.

For example, if a country is able to produce more grapes than any other country, as well as produce grapes more efficiently than any of the other goods they produce, this country would have an absolute and comparative advantage in producing grapes.

If this same country produces more olives than any other country, but their production of olives has a high opportunity cost when compared to grapes, the country would have an absolute advantage in producing olives, but not a comparative advantage.