Comparative advantage is doing that in which one has an advantage to all other skills that one possesses; OR to pursue comparative advantage means to sacrifice that which is less valuable for the sake of something more valuable.

It is comparative advantage – the relative advantage resources have, in given uses, over resources in other uses – that determines the most efficient way to employ one’s resources.

Hence we should specialize in the production of those goods in which we think we have the greatest comparative advantage. Bearing in mind that human capital consists of skills, knowledge and experience.


This example is given in 'The Wealth of Nations', by Adam Smith:

See interactive ebook on iBookstore