Comparative Advantage – applied and ignored

Over the course of the spring I have been ever-so-slowly building a playground in the backyard for my kids. Economically, this is a very silly thing for me to do.

The theory of comparative advantage states that when each of us spends time doing the things he or she is more productive at then everyone benefits: if I can earn a higher wage elsewhere, I can pay someone to build the playground. I keep the difference between what I make and what the landscaper charges; the landscaper earns a wage; and my kids have a playground that is built better and done sooner.

Unless you factor in that I enjoy spending the time outside, working with my hands. And the pride I’ll get watching my kids enjoy the playground Daddy built them.

Of course I can’t spend all weekend on this, because I still have to study once in a while. But it will be done soon, and then I can move on to the next project.

One thought on “Comparative Advantage – applied and ignored”

  1. Very good that you are trying to do something with their hands. However, in my example, I was convinced that it is impossible upet do everything yourself. Have to hire professionals. Certainly it seems that nobody is better than you, it can not cope, but it is misleading.

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