free trade refers to the relative absence of restrictions to the flow of goods and services between nations
comparative advantage describes superior features of a nation that provide unique benefits in global competition
comparative advantages typically derive from either natural endowments or deliberate national policies
comparative advantage is also known as country specific advantage
comparative advantage includes labor, climate, arable land, petroleum reserves and other inherited resources such as those enjoyed by countries in the Middle East
other types of comparative advantage are acquired over time such as entrepreneurial orientation, availability of venture capital, and innovative capacity
comparative advantage is an economy's ability to produce a particular good or service at a lower opportunity cost than its trading partners
competitive advantage refers to assets and capabilities of a company that are difficult for competitors to imitate
competitive advantages help firms enter and succeed in foreign markets
competitive advantage takes various forms such as specific knowledge, competencies, innovativeness, superior strategies, or close relationships with suppliers
competitive advantage is also known as firm specific advantage
in recent years, business executives and scholars have used competitive advantage to refer to advantages possessed by nations and individual firms in international trade and investment