engleski

Determination of the relative advantages in the cattle production of milk and meat by comparative analysis of production in Osijek- Baranja County and Krapina-Zagorje County

The use of relative advantages in practice implies that one area concentrates on the production of those kind of products for which there is lower opportunity cost. Osijek-Baranja County is rich in arable agricultural land. Compared with Krapina-Zagorje County, where the agricultural land area is much lower, it could be said that the Osijek-Baranja County has an advantage in terms of agricultural production. This paper analysed, using the Comparative model of production opportunities, that it is necessary to use natural resources and put them into operation after profit. Free trade increases the overall production and consumption of all participants in trade because it enables production specialization in which specific areas have more relative, and not absolute efficiency (products with less relative marginal costs). Comparative model of production opportunities is the model which points to the production orientation of that good which achieves maximum benefit.

agricultural production; relative advantage; opportunity cost; labour productivity; limit of production possibilities

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