Optimal International Division of Labour

Abstract

The international division of labour implies both advantages and disadvantages to an economy. As long as the marginal costs and marginal benefi ts associated with the international division of labour stick to standard economic theory, there is an optimal degree of this division for every economy. The corona pandemic is likely to change the fundamentals for relevant decisions–both from the perspective of companies and of the society as a whole–in such a way that the extent of the division of labour and international trade will decrease correspondingly.