In a world where the only goods are cell phones and cereal: Jennereelam can produce: 80m kilos of cereal, and 200k cell phones, while Jonathannadu can produce: 30m kilos of cereal, and 15k cell phones. Even though Jennereelam is a bigger economy and can produce more of each product than Jonathannadu, this guy named Ricardo insists that they will both benefit if they trade. What is Ricardo's argument called, and why does he make the claim?

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Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.