Take Ricardo's own example: Portugal and England. Portugal could make both wine and cloth more cheaply, yet both countries gained when Portugal specialized in wine and England in cloth.

The magic is in opportunity cost. Even though Portugal was better at cloth, every hour spent on cloth was an hour not spent on wine — where its lead was even bigger. Specializing in your strongest area maximizes total output.

This is why lawyers hire assistants even when they can type faster. The lawyer's time is worth more on legal work, so paying someone to type makes both sides better off despite the skill gap.