As part of my continuing professional development this summer I will be completing 3 online graduate classes - one of which is BU 631 International Economics and Trade. My first assignment in this class is a summary of Ricardo's Comparative Advantage.
David Ricardo in the preface to On the Principles of Political Economy and Taxation to writes:
"The real price of every thing," says Adam Smith, "what every thing really costs to the man who wants to acquire it, is the toil and trouble of acquiring it. What every thing is really worth to the man who has acquired it, and who wants to dispose of it, or exchange it for something else, is the toil and trouble which it can save to himself, and which it can impose upon other people." (http://www.econlib.org/library/Ricardo/ricP.html)
Ricardo goes on to develop one of the more profound contributions to social thought in his explication of value and the basis of exchange or the “toil and trouble which he can save to himself,” which is the famous comparative advantage. In chapter 7, Ricardo asserts the advantages of free trade in both the international and domestic arenas and them provides his numerical example, frequently included in introductory textbooks.
Analysis of comparative advantage over at 26econ
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Definition of SCR
The point is that socially responsible corporate behavior may mean different things in different places, to different people, and at different times, so we must be careful how we use the concept and how we define it. And care is required in measuring the degree to which corporations are actually behaving in socially responsible ways or simply making hollow claims to that effect. Finally, caution is warranted insofar as the concept itself is a fairly new one in the world and because its different local meanings, which are only now beginning to diffuse internationally, have not yet congealed in a single commonly accepted definition (Boxenbaum 2004).4
I view corporations as acting in socially responsible ways if they do two things. First, they must not knowingly do anything that could harm their stakeholders, notably their investors, employees, customers, suppliers, or the local community within which they operate. Second, if corporations do cause harm to their stakeholders, then they must rectify it whenever it is discovered and brought to their attention. Rectification could be done voluntarily or in response to some sort of encouragement, such as moral suasion, normative pressure, legal threats, regulatory rulings, court orders, and the like. This is a definition that sets a minimum behavioral standard with respect to the corporation’s relationship to its stakeholders below which corporate behavior becomes socially irresponsible. Unless noted otherwise, this is the definition that I will use throughout the rest of this paper.5
John Campbell
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