Answer this Question ( it just a discussion so you don’t need to write too long) Adam Smith wrote about the “invisible hand’ and was in favor of free trade. Michael Porter wrote about national competitive advantage. Discuss how these 2 theories are related. State and explain your stance on free trade based upon your understanding and agreement/disagreement with these 2 theorists. Reply these two answers You agree with their answer or not, give more opinion. 1/ In the free market economy, self-absorbed individuals function through a structure of mutual interdependence to endorse general benefit of the society at large. Charitable trades in a free market produce accidental and widespread benefits and these benefits are greater than those of a synchronized, planned economy are. Michael E. Porter disputes that a nation can generate new advanced factor donations like skilled labor, a strong technology and Knowledgebase, government support and culture. They are both similar in the logic that they are uniformly good for the nation, but in actuality, this is not the case. Some industries will produce bigger profits, higher wages, and higher taxable income. 2/ Smith wrote of a laisse-faire type trade that allowed businesses to trade based more or less on the demand of the product in a particular country and that governments should not interfere with how a business performed its trading. He argued for absolute advantage so the most benefit by all trading countries would be gained and a positive-sum game achieved. Porter wrote of the competitive advantages free trade offered to businesses and the consumer/economies which they exist. Porter’s Diamond express advantageous ideals to why some nations achieve international success in particular industries with competitive advantage: Firm strategy, structure, and rivalry, factor endowments, demand conditions, and related and supporting industries. He further asserts chance and government as additional variables that influence a nation’s diamond. Both theories suggest free trade offers a form of achievement while a country produce the items that are of abundance in resource to its comparative (basic and advanced) advantage and trade with other countries that offer specialized product of value which are scarce to its own country’s resources. I think there should be free trade with stipulations by government enforcement. The level of government interference should be something that is of a democratic vote as with many other things in a republic. I feel however that companies have their abilities, freedoms and restrictions, in part because of governments and if things go array that government intervention may be necessary.