A country can gain from trade even if it's worse at making everything

David Ricardo showed that even if one country can produce every good more efficiently than another, both still gain by specialising: each should make whatever it gives up the least to produce, and trade for the rest. In his classic example, Portugal could make both cloth and wine more cheaply than England — yet both countries end up richer if Portugal focuses on wine and England on cloth.

— David Ricardo, On the Principles of Political Economy and Taxation — 1817
Go deeper: get the book →