Final answer:
The owners of domestically scarce factors of production may lose while the owners of domestically abundant factors may gain in free trade.
Step-by-step explanation:
In the context of free trade, the owners of domestically scarce factors of production may lose, while the owners of domestically abundant factors may gain.
When a country engages in free trade, industries that are domestically scarce, meaning that the country does not have a comparative advantage in those industries, may face competition from other countries that can produce those goods more efficiently. This competition can lead to job losses and reduced profits for the owners of the domestically scarce factors of production.
On the other hand, industries that are domestically abundant, meaning that the country has a comparative advantage in those industries, can benefit from free trade. With increased access to international markets, these industries can expand their production and exports, which can lead to increased profits and job opportunities for the owners of the domestically abundant factors of production.