Ricardo's comparative advantage is the most counterintuitive result in economics: even if one party is absolutely better at everything, both parties gain from trade.

The intuition: opportunity cost. If you're faster at both farming and coding but faster at coding by more, you should code. Your trading partner should farm even if they're slower at farming than you — because they're even slower at coding.

The model assumes: constant returns, no factor mobility, no externalities. Real trade violates all three. The case for trade remains strong but not automatic.

Related: [[coordination-problems]], [[price-signals]]