absolute advantage

Definition

The name for the ability of one entity to engage in more efficient production than another entity. Assuming equal inputs, the entity with an absolute advantage will have a greater output.

Use absolute advantage in a sentence

Microsoft had an absolute advantage over the small technology firm because it had cheaper sources of labor and raw materials.

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An individual working with two displays connected to his computer terminal has an absolute advantage over an individual with just one due to increased potential productivity.

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My father owned a bar that was next door to a factory, and he got more customers to come to his bar over the one further down the street because he had an absolute advantage in location.

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absentee owner comparative advantage