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Uncertainty and the Properties of the Heckscher-Ohlin Model

  • Raveendra N. Batra

Abstract

While establishing the validity of the Heckscher-Ohlin (H.O.) proposition in the presence of risk-averse behaviour by producers, we introduced a number of assumptions in addition to those which are usually maintained for this type of analysis. It is high time that we justify these assumptions, which required α, its probability distribution, and the producers’ attitudes towards risk to be the same in both countries. Our defence, of course, is the fact that without these assumptions the H.O. theorem may not hold in our stochastic model.

Keywords

International Trade Home Country Free Trade Foreign Country Factor Price 
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References

  1. [1]
    Batra, R. N., Studies in the Pure Theory of International Trade( London: Macmillan, 1973 ).Google Scholar
  2. [2]
    Hicks, J. R., The Theory of Wages( London: Macmillan, 1932 ).Google Scholar
  3. [3]
    Johnson, H. G., International Trade and Economic Growth(Cambridge, Mass.: Harvard University Press, 1967) chap. 1.Google Scholar

Copyright information

© Raveendra N. Batra 1975

Authors and Affiliations

  • Raveendra N. Batra
    • 1
  1. 1.Southern Methodist UniversityUSA

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