This chapter examines the sources of a nation’s industrial comparative advantage by expanding on the concepts we explored in the first two chapters. We then turn our attention to the role of transportation costs and their effect on the flow of trade.
The role of industrial policy and environmental regulatory policies imposed by governments also effect trade. Finally, we discuss how transportation costs influence the volume of international trade by impacting the final prices of traded goods.
Human intellect has always been, and still is, the only source and the most powerful contributor to technological advancement, pushing the cutting edge of skilled labor to new highs, positioning in this way, the human mind to the rank of the most valuable capital asset. Skill becomes the source of comparative advantage.
![](https://s2.save4k.ru/pic/r9hlQjneYXU/maxresdefault.jpg)