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A country has an absolute advantage economically over another, in a particular good, when it can produce that good more efficiently. Using the same input of resources a country with an absolute advantage will have greater output.
The term is important in the theory of international trade because it is often mistakenly assumed that (to take an example) if France has an absolute advantage over England in some product, say cheese, then France will not normally import cheese from England. A seminal analysis by the 19th-century English economist David Ricardo showed that despite France's absolute advantage, it may well benefit both countries for England to produce and export cheese to France. International trade is the exchange of goods and services across international boundaries or territories. ...
David Ricardo (April 18, 1772 – September 11, 1823), a political economist, is often credited with systematising economics, and was one of the most influential of the classical economists, along with Thomas Malthus, and Adam Smith. ...
Ricardo identified comparative advantage, rather than absolute advantage, as the correct concept for understanding efficient patterns of production and exchange across countries. His discussion is central to modern trade theory. In economics, the theory of comparative advantage explains why it can be beneficial for two parties (countries, regions, individuals and so on) to trade if one has a lower relative cost of producing some good. ...
Example Country A can produce product z using one unit of labour. Country B can produce product z using two units of labour.
Country A has an absolute advantage over Country B in product z.
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