1.Comparative Labor Costs
___（1）___. Together， they constitute the unit labor cost involved in producing a commodity.
Some countries may find that the labor wages are very low， yet they are not in a competitive position when trading with other countries， whose labor wages are very high.
___（2）___. On the other hand， some countries find that their productivity is much higher than that of their trading partners， yet they are not in a competitive trading position either. This is because their labor wages are much higher than those of their trading partners. ___（3）___. For instance， wages are low in most developing countries. ____（4）_____. Their productivity is low too. Success depends on the unit labor cost of the products in certain industries， such as radio production and television set assembling， unit labor cost may be low and thus they would be in a competitive position， while in others， low labor wages are offset by very low productivity. Their unit labor cost is high and they are in an unfavorable position in trading with other countries.
Unit labor cost is an important determinant of prices of manufactured goods， but other costs also influence prices： notably， those of capital， energy and raw materials. ___（5）___.
A. Moreover， a country‘s competitive position is not solely determined by price salesmanship. Credit terms， adherence to delivery schedules and so on also affect competitiveness.
B. At least two factors determine a country‘s comparative position： labor productivity and wage level.
C. So it is the unit labor cost that determines the competitive position， but only low wages or only high productivity.
D. This may be because they neglect their low productivity.
E. Does this mean that these countries are in a favorable position in trade？ It is not necessarily so.
F. Generally speaking， all the countries are paying more and more attention to their wage levels.