In the modern world of contemporary economics, trade liberalization and globalization are constantly debated topics. One aspect of the thesis is that free trade and globalization will ultimately lead to poverty reduction in developing countries and that the GDP of developed nations will reflect an increase that would otherwise be unattainable. The other side of the argument, however, argues that there is already evidence to the contrary that the introduction of free trade unfairly favors developed nations and cripples infant industries. Globalization and trade liberalization will be elaborated below, also the relationships with David Ricardo's theories of international trade, David Ricardo and the Heckscher-Ohlin theorem. Globalization is a worldwide movement toward economic, trade, financial, and communications integration (“Business Dictionary,” 2013). ). This would allow companies to operate on a multinational level, previously limited to local communities as their target market. Taking advantage of different production abundance factors in multiple countries. An important aspect of globalization is trade liberalization, or the removal or reduction of trade barriers to the free exchange of goods between nations (“Investopedia,” n.d.). These barriers can include tariffs and quotas, as well as non-tariff barriers such as licensing rules (“Investopedia,” n.d.). Removing such barriers allows international trade to occur more easily and countries to practice the aspect of comparative advantage over other economies. In Adam Smiths paper “The Wealth Of Nations” Adam Smiths paper projects the vision of international trade as a non-zero summation equation that will ultimately be beneficial to all parties involved. By and... middle of the paper... country. One of the main arguments against globalization is that large companies take advantage of poorer nations. Opponents argue that companies take advantage of their workforce by offering them unfair working conditions and disrespecting the environment (“Economist” 2001). While this may have been the case in the past, most multinational corporations are working to clean up their practices in developing countries. Regardless of how living standards are measured, it is clear that economies that adopt free trade policies perform better than their counterparts. that maintain protective trade barriers. This economic performance has led to a sharp increase in living standards in these countries, providing clear examples of how free trade can be used to help underdeveloped economies catch up with more developed nations..