On the Principles of Political Economy and Taxation.¶
Ricardo, D. (1817). On the Principles of Political Economy and Taxation.
Cited by¶
10 citations across 10 artifacts.
Each citation links to the sentence it supports in the citing article.
Primes¶
- Arbitrage (Generalized)
- The deep structure here is the principle of comparative advantage that Ricardo (1817) developed in On the Principles of Political Economy and Taxation: even when one region is absolutely more productive across all activities, differential opportunity costs create gains from reallocation across the boundary.
This sourceJohn Murray, London. Chapter 7 ("On Foreign Trade") develops the theory of comparative advantage with the canonical England-Portugal cloth-and-wine example: even when one country is absolutely more productive in both goods, both gain by specializing according to relative opportunity costs and trading. Extends Smith's intra-workshop partitioning logic to the international scale, where geographies become the differentiated performers and trade is the re-integration interface.
SupportedVerified against the work's full text
Ricardo's England-Portugal cloth and wine example shows trade benefiting Portugal even though it needs less labour for both goods.
“This exchange might even take place, notwithstanding that the commodity imported by Portugal could be produced there with less labour than in England.”
- The deep structure here is the principle of comparative advantage that Ricardo (1817) developed in On the Principles of Political Economy and Taxation: even when one region is absolutely more productive across all activities, differential opportunity costs create gains from reallocation across the boundary.
- Comparative Advantage
- The essential commitment is that the relative efficiencies — not absolute ones — determine the welfare-improving pattern of production, and that trade based on comparative advantage is (under the standard assumptions) positive-sum, with each party better off after specialization and trade than in autarky.
This sourceChapter 7 ("On Foreign Trade") develops comparative advantage with the canonical England–Portugal cloth-and-wine example (the 'four magic numbers': England 100 cloth / 120 wine, Portugal 90 cloth / 80 wine); shows both countries gain by specializing on relative opportunity costs even when one is absolutely more productive in both goods.
SupportedVerified against the work's full text
Ricardo's England-Portugal cloth-and-wine example shows trade on relative labour costs leaves both countries with more than self-supply, despite Portugal's absolute edge in both.
“This exchange might even take place, notwithstanding that the commodity imported by Portugal could be produced there with less labour than in England. Though she could make the cloth with the labour of ninety men, she would import it from a country where it required the labour of 100 men to produce it”
- The essential commitment is that the relative efficiencies — not absolute ones — determine the welfare-improving pattern of production, and that trade based on comparative advantage is (under the standard assumptions) positive-sum, with each party better off after specialization and trade than in autarky.
- Diminishing Returns (Law of)
- for agricultural yields, developed by Ricardo (1817)
This sourceDevelops the theory of rent (esp. Ch. 2 'On Rent'): as population grows and inferior soils are brought into cultivation, diminishing returns to land raise rents and lower profits; rent arises from differential fertility and location of soils.
SupportedVerified against the work's full text
Ricardo's 1817 chapter on rent works out diminished returns to successive doses of capital and labour on land, and to poorer soils, as the source of rent.
“capital could be indefinitely employed without a diminished return on the old land, there could be no rise of rent”
- for agricultural yields, developed by Ricardo (1817)
- Division of Labor
- Economics and economic history: Adam Smith's pin-factory analysis and the foundational role of division of labor in productivity growth; Ricardo (1817) extending the logic from inside the workshop to between nations through the theory of comparative advantage, where partitioning across geographies follows opportunity-cost differentials rather than absolute productivity.
Supported in partVerified against the work's full text
Ricardo's wine-and-cloth example shows trade between countries following relative labour costs even when one country is more productive at both goods; the Smith pin-factory half is not in this source.
“This exchange might even take place, notwithstanding that the commodity imported by Portugal could be produced there with less labour than in England.”
- Economics and economic history: Adam Smith's pin-factory analysis and the foundational role of division of labor in productivity growth; Ricardo (1817) extending the logic from inside the workshop to between nations through the theory of comparative advantage, where partitioning across geographies follows opportunity-cost differentials rather than absolute productivity.
- Exchange
- Economics: Market trade, barter, contract, gains-from-trade, transaction costs as friction on the exchange process, comparative advantage as the gains-structure available to bilateral exchange between differently endowed parties; Ricardo's (1817) comparative-advantage analysis is a theorem about what Exchange makes possible, not about markets per se.
This sourceJohn Murray, London. Chapter 7 ('On Foreign Trade') develops comparative advantage with the England
Supported in partVerified against the work's full text
Ricardo's England-Portugal example shows trade can benefit both parties even when one is more productive in both goods; the 'theorem about exchange, not markets' reading is the encyclopedia's.
“This exchange might even take place, notwithstanding that the commodity imported by Portugal could be produced there with less labour than in England.”
- Economics: Market trade, barter, contract, gains-from-trade, transaction costs as friction on the exchange process, comparative advantage as the gains-structure available to bilateral exchange between differently endowed parties; Ricardo's (1817) comparative-advantage analysis is a theorem about what Exchange makes possible, not about markets per se.
- Gains from Trade
- Gains from Trade names the abstraction that (1) when two or more parties each specialize in activities where they hold a comparative advantage — the lowest opportunity cost, not necessarily the lowest absolute cost — and then (2) voluntarily Exchange their surplus output on mutually agreeable terms, (3) the combined consumption possibilities of the participants strictly exceed what any of them could reach under autarky (self-sufficiency), so that (4) trade, properly structured, is a positive-sum transformation in which everyone can be made better off without anyone being made worse off.
This sourceCh. 7 ('On Foreign Trade') develops comparative advantage via the England-Portugal cloth-and-wine example; directly supports the Core-Idea statement of the gains-from-trade abstraction and the Structural-Signature 'set of agents with different endowments' element.
Supported in partVerified against the work's full text
Ricardo shows specialisation by relative labour cost and exchange yielding general benefit (England-Portugal), but not the autarky comparison or a no-one-worse-off guarantee.
“each country naturally devotes its capital and labour to such employments as are most beneficial to each. ... by increasing the general mass of productions, it diffuses general benefit”
- Gains from Trade names the abstraction that (1) when two or more parties each specialize in activities where they hold a comparative advantage — the lowest opportunity cost, not necessarily the lowest absolute cost — and then (2) voluntarily Exchange their surplus output on mutually agreeable terms, (3) the combined consumption possibilities of the participants strictly exceed what any of them could reach under autarky (self-sufficiency), so that (4) trade, properly structured, is a positive-sum transformation in which everyone can be made better off without anyone being made worse off.
- No Free Lunch Theorem
- In economics, comparative advantage and the specialization-versus-flexibility tension mean a firm or country excelling in one product class is by that fact less able to excel in others.
This sourceStates the theory of comparative advantage, the economic instance of the specialization-versus-flexibility conservation in which excelling in one product class entails being less able to excel in others.
Supported in partVerified against the work's full text
Ricardo's Portugal/England example gives the comparative-advantage logic of specializing, but does not say excelling in one class makes one less able in others.
“Though she could make the cloth with the labour of ninety men, she would import it from a country where it required the labour of 100 men to produce it”
- In economics, comparative advantage and the specialization-versus-flexibility tension mean a firm or country excelling in one product class is by that fact less able to excel in others.
- Opportunity Cost
- .
This sourceJohn Murray, London. Chapter 7 ("On Foreign Trade") develops the theory of comparative advantage with the canonical England-Portugal cloth-and-wine example: even when one country is absolutely more productive in both goods, both gain by specializing according to relative opportunity costs and trading. Extends Smith's intra-workshop partitioning logic to the international scale, where geographies become the differentiated performers and trade is the re-integration interface.
Supported in partVerified against the work's full text
Ricardo's Chapter VII shows trade pays when each country puts capital where its relative labour cost is lowest, but it never uses the term opportunity cost.
“Though she could make the cloth with the labour of ninety men, she would import it from a country where it required the labour of 100 men to produce it, because it would be advantageous to her rather to employ her capital in the production of wine, for which she would obtain more cloth from England”
- .
- Specialization
- Specialization across firms and regions underlies trade theory, where each party concentrates on what it produces at lowest opportunity cost.
This sourceJohn Murray, London. Chapter 7 ("On Foreign Trade") develops the theory of comparative advantage with the canonical England-Portugal cloth-and-wine example: even when one country is absolutely more productive in both goods, both gain by specializing according to relative opportunity costs and trading. Extends Smith's intra-workshop partitioning logic to the international scale, where geographies become the differentiated performers and trade is the re-integration interface.
SupportedVerified against the work's full text
Ricardo shows countries devoting capital and labour to what is most beneficial and trading, with Portugal making wine and importing cloth even though she could make cloth with less labour.
“because it would be advantageous to her rather to employ her capital in the production of wine, for which she would obtain more cloth from England, than she could produce by diverting a portion of her capital”
- Specialization across firms and regions underlies trade theory, where each party concentrates on what it produces at lowest opportunity cost.
Domain-specific¶
- Absolute Advantage
- The step from that observation to a general theory of specialization, however, belongs to Ricardo: comparative advantage, which examines opportunity cost rather than absolute output, identifies the specialization pattern that maximizes joint output even when one country has absolute advantage in all goods
This sourceRicardo's England-Portugal cloth-and-wine case, showing that specialisation follows relative labour cost and that a country gains from trade even where its trading partner could make the imported good with less labour.
SupportedVerified against the work's full text
“It is this principle which determines that wine shall be made in France and Portugal, that corn shall be grown in America and Poland, and that hardware and other goods shall be manufactured in England.”
- The step from that observation to a general theory of specialization, however, belongs to Ricardo: comparative advantage, which examines opportunity cost rather than absolute output, identifies the specialization pattern that maximizes joint output even when one country has absolute advantage in all goods
Verification¶
Does it exist? Not checked yet. This entry carries no identifier to resolve. It was extracted from the citation as written in the article, normalized, and deduplicated against the rest of the registry.
Does it back the claim? Read against the text for 10 of 10 citations: 5 supported, 5 supported in part. Each verdict is shown under its citation below, with what in the work backs the sentence.
Support is checked per citation rather than per work — the same source can be cited soundly in one article and wrongly in another. Per-citation recording began recently, so a citation with no recorded check is a gap in the record rather than evidence it went unchecked.
See how references were verified.
Links previously used in the corpus¶
Before the registry existed this work was also linked 1 other way.
Registry ID ref:32aeb48bf274 · see in the full table