First it is crucial to understand the concept of comparative advantage which is "The person or country that produces a good with a smaller quantity of inputs, or that produces more output per unit of input, is said to have an absolute advantage in producing that good”. To illustrate the concept of comparative advantage requires at least two goods and at least two places where each good could be produced with scarce resources in each place. The example drawn here is from Ehrenberg and Smith (1997), page 136. Suppose the two goods are food and clothing, and that "the price of food within the United States is 0.50 units of clothing and the price of clothing is 2 units of food. [Suppose also that] the price of food in China is 1.67 units of clothing and the price of clothing is 0.60 units of food." Then we can say that "the United States has a comparative advantage in producing food and China has a comparative advantage in producing clothing.
Countries usually trade to buy goods that are produced at a lower cost elsewhere. Countries and people have different costs of production or (to put it differently) different abilities in producing goods. They can take advantage of their differences in order to make themselves better off. When they do this, they experience gains from trade. (Moffatt, 2011)

First, endowments of key inputs may vary from nation to nation, just as endowments of talents, skills, and physical characteristics vary across individuals. For example, commercial farming uses large amounts of land, so if land is especially scarce in a country (Japan, for example), it is likely to import agricultural products, which can be grown at a lower cost in nations where are able land is more abundant. (Deardorff)

Second, differences in government services and regulations can also result in different comparative advantages. For example, nations with compulsory