WOLFRAM|DEMONSTRATIONS PROJECT

Efficient Total Production through Specialization

​
units of X produced by A without specialization
units of X produced by B without specialization
without specialization
with specialization
increase
A
B
A+B
A
B
A+B
A+B
units of X
10
15
25
20.0
8.6
28.6
3.6
units of Y
5
20
25
0.0
28.6
28.6
3.6
—
production possibilities frontier of A
—
production possibilities frontier of B
⟶
production of A with specialization
⟶
production of B with specialization
⟶
production of A without specialization
⟶
production of B without specialization
—
joint production possibilities frontier of A and B
This Demonstration presents an economic model of two producers A and B that produce two goods X and Y. It is shown how specialization leads to an efficient total production. A and B can benefit from the increased total production through trade.