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International Trade Theory

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International Trade Theory
The Ecuadorian

Rose Industry snowcapped volcanoes that rise to more than 20,000 feet. The bushes are protected by 20-foot-high canopies of plastic sheeting. The combination of intense sunlight, fertile volcanic soil, an equatorial location, and high altitude makes for ideal growing conditions, allowing roses to flower almost year-round. Ecuador apparently has a comparative advantage in the production of roses. Ecuador's rose industry started some 20 years ago and has been expanding rapidly since. Ecuador is noW the world's fourth largest producer of roses. Roses are the nation's fifth largest export, with customers allover the world. Rose farms generate $240 million in sales and support tens of thousands of jobs. In Cayambe, the population has increased in 10 years from 10,000 to 70,000, primarily as a result of the rose industry. The revenues and taxes from rose growers have helped to sophisticated pave roads, build schools, and construct irrigation systems. Maria works Monday to Saturday, and earns $210 a month, which she says is an average wage in Ecuador and substantially above the country's $120 a month

It is 6:20 AM, February 7, in the Ecuadorian town of
Cayambe, and Maria Pacheco has just been dropped off for work by the company bus. She pulls on thick rubber gloves, wraps an apron over her white, traditional embroidered dress, and grabs her clippers, ready for another long day. Any other time of year, Maria would work until 2 PM, but it's a week before Valentine's Day, and Maria along with her 84 coworkers at the farm are likely to be busy until 5 PM. By then, Maria will have cut more than 1,000 rose stems. A few days later, after they have been refrigerated and shipped via aircraft, the roses Maria cut will be selling for premium prices in stores from New York to London. Ecuadorian roses are quickly becoming the Rolls Royce of roses. They have huge heads and unusually vibrant colors, including 10 different reds, from bleeding heart crimson to a

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