One more from Marginal Revolution
Just one more post from Marginal Revolution tonight. Countries taking advantage of comparative advantage under a regime of free trade would tend to specialize in the production of different things. On the other hand, one of the chief defenses against excessive risk is diversification into activities with relatively uncorrelated returns. Tyler Cowen isn't too impressed with the diversification reservation, and explains why in "Does free trade lead to insufficient diversification?".
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