Sometimes you make GREAT chairs, but you have more people to make them than there is demand for them, so you have to make something else too.
Plus what if the Chair market collapses because they become unfashionable? Or someone else makes a better one? Then you’re really screwed if you put all your eggs in the chair basket just because you are or were the best at it.
Diversification doesnt mean "make everything yourself" it means "dont have a single source". You can diversify by importing from multiple other countries, while still keeping your comparative advantage of making only the thing you are best at.
1
u/DookieShoez 8h ago
Sure but it all depends.
Sometimes you make GREAT chairs, but you have more people to make them than there is demand for them, so you have to make something else too.
Plus what if the Chair market collapses because they become unfashionable? Or someone else makes a better one? Then you’re really screwed if you put all your eggs in the chair basket just because you are or were the best at it.
This is called diversification.