Although Traditional Trade Theories Suggest That Developing Countries Should Specialize

question 46

Essay

Although traditional trade theories suggest that developing countries should specialize in labor intensive commodities like,raw material,food,minerals,etc.,why do some developing countries believe that a pattern of specialization under the theory of comparative advantage relegated them to a subordinate position compared to the developed nations?

---

Definitions:

Prepayment

The act of repaying a loan or part of a loan before its due date, which can sometimes lead to penalties or the waiving of future interest.

Collateral

refers to assets that are pledged as security for the repayment of a loan, ensuring the lender can seize the assets if the loan is not repaid.

Reimbursement

The process of compensating someone for an expense they have incurred.

Surety

A person or entity that takes responsibility for another's performance of an undertaking, such as fulfilling the terms of a contract.