Final answer:
States that specialize in producing goods they are most efficient at and trading for other goods exhibit the economic principle of comparative advantage, which improves overall economic efficiency and productivity.
Step-by-step explanation:
When states specialize in producing the goods that they produce best and trade for goods that other states are better at producing, they are operating according to a principle known as comparative advantage. This economic concept suggests that a state should produce and export goods and services it can create more efficiently than others and import goods and services in which other states have an efficiency advantage. Such specialization is influenced by various factors including individual talents, educational choices, geography, and the sociopolitical environment.
For example, a place with favorable climate conditions for agriculture may specialize in farming, while another with abundant mineral resources may focus on mining. This specialization enables each state to produce what it does best and contribute to a greater economic efficiency overall. By doing so, they can enhance productivity, stimulate competition and, in turn, enjoy a diverse range of goods and services through trade with others. It is an underlying foundation of international trade and economic policy.