why doesn t the world have open trading between countries when there is free trade why do some countries remain poor at the expense of others perhaps comparative advantage does not work as suggested there are many reasons this could be the case but the most influential is something that economists call rent seeking rent seeking occurs when one group organizes and lobbies the government to protect its interests 
say for example the producers of american shoes understand and agree with the free trade argument but they also know that their narrow interests would be negatively impacted by cheaper foreign shoes even if laborers would be most productive by switching from making shoes to making computers nobody in the shoe industry wants to lose their job or see profits decrease in the short run this desire leads the shoemakers to lobby for say special tax breaks for their products or extra duties or even outright bans on foreign footwear appeals to save american jobs and to preserve a time honored american craft abound even though in the long run american laborers would be made relatively less productive and american consumers relatively poorer by such protectionist tactics advantages and disadvantages of comparative advantagein international trade the law of comparative advantage is often used to justify globalization since countries can have higher material outcomes by producing only goods where they have a comparative advantage and trading those goods with other countries countries like china and south korea have made major productivity gains by specializing their economies in certain export focused industries where they had a comparative advantage following comparative advantage increases the efficiency of production by focusing only on those tasks or products that one can achieve more cheaply products that are more expensive or time consuming to make can be purchased from elsewhere in turn this will improve a company s or a country s overall profit margins since costs associated with less efficient production will be eliminated on the other hand over specialization also has negative effects especially for developing countries while free trade allows developed countries to access cheap industrial labor it also has high human costs due to the exploitation of local workforces by offshoring manufacturing to countries with less stringent labor laws companies can benefit from child labor and coercive employment practices that are illegal in their home countries likewise an agricultural country that focuses only on certain export crops may find itself suffering from soil depletion and destruction of its natural resources as well as harm to indigenous peoples moreover there are also strategic disadvantages to over specialization since that country would find itself dependent on global food prices 2higher efficiencyimproved profit marginslessens the need for government protectionismdeveloping countries may be kept at a relative disadvantagemay promote unfair or poor working conditions elsewherecan lead to resource depletionrisk of over specializationmay incentivize rent seekingwho developed the law of comparative advantage the law of comparative advantage is usually attributed to david ricardo who described the theory in on the principles of political economy and taxation published in 1817 however the idea of comparative advantage may have originated with ricardo s mentor and editor james mill who also wrote on the subject 3