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Heckscher–Ohlin Trade Theory

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The New Palgrave Dictionary of Economics

Abstract

Heckscher–Ohlin trade theory consists of four principal theorems, viz. the Heckscher–Ohlin trade theorem whereby relatively capital-abundant countries export relatively capital-intensive commodities, the factor-price equalization theorem whereby trade in goods may serve to equalize wage rates between countries, the Stolper–Samuelson theorem whereby an increase in the price of the relatively labour- intensive commodity unambiguously improves the real wage rate, and the Rybczynski theorem stating that an increase in capital endowment by itself must cause some output to fall if prices are held constant. The article discusses the nature and fate of these theorems.

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  1. http://link.springer.com/referencework/10.1057/978-1-349-95121-5

    Ronald W. Jones

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  1. Ronald W. Jones
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Jones, R.W. (2018). Heckscher–Ohlin Trade Theory. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_1116

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