10.4225/03/593616887ee99
Yang, Xiaokai
Xiaokai
Yang
Cheng, Wenli
Wenli
Cheng
An Inframarginal Analysis of the Heckscher-Olin Model
Monash University
2017
Stolper-Samuelson theorem
monash:7008
1997
1959.1/36411
Rybczynski theorem
HO theorem
Factor equalization theorem
2017-06-06 02:42:13
Journal contribution
https://bridges.monash.edu/articles/journal_contribution/An_Inframarginal_Analysis_of_the_Heckscher-Olin_Model/5080945
In the paper we check if the four core theorems of trade, the Heckscher-Olin (HO) theorem, the Stopler-Samuelson theorem, the Rybczynski theorem, and factor equalization theorem, hold in a general equilibrium analysis with endogenous prices of goods and factors and if they hold when all trade patterns outside the diversification cone and discontinuous jumps of general equilibrium between different trade patterns are considered. Also, comparative advantage in technology between countries is added to comparative advantage in endowments to accommodate empirical evidences that are incompatible with the core theorems. The HO theorem can stand the test though it needs to be refined when technical comparative advantage is introduced. The other core theorems cannot stand the test.