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Richland, a small country, is considering whether to engage in the international trade. There are two products produced in Richland, rice and furniture.

Richland, a small country, is considering whether to engage in the international trade. There are two products produced in Richland, rice and furniture. Suppose that the world price of rice is lower than Richland’s autarky price of rice but its autarky price of furniture is lower than the world price of furniture. Assume that land is a sector-specific factor such that it can be utilized only in the production of rice, whereas labours are free to move across sectors. Do you think the landowners will support the move to free trade?

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