The Theory of Comparative Advantage
In 1817 Ricardo showed that it makes sense for a country to specialize in the production of goods in which it simply has a comparative advantage, even if it can produce both goods more efficiently than the other country.
Ghana uses 10 resources to produce a ton of Cocoa; Korea uses 40 resources to produce a ton of Cocoa; Ghana uses 15 resources to produce a ton of rice; Korea uses 20 resources to produce a ton of rice.
In the example above, Ghana has a comparative advantage in producing Cocoa whereas Korea has a comparative advantage in producing rice.