Heckscher-ohlin theory, International Economics

Assignment Help:

Q. Countries do not in fact export the goods the H.O. theory predicts. Discuss.

Answer: This statement isn't true that though one may find several cases where it seems to be true (e.g. the Leontieff Paradox), all one requires to do in order to render the above statement not (generally) true is to find one counter example. Actually, one is able to find large subsets of agricultural and commodity products in which the H.O predictions are usually fulfilled. Labor-intensive countries for instance Bangladesh does in fact export relatively labor-intensive goods. Capital-intensive countries for instance Germany does in fact export capital-intensive products at least to South countries. Countries for illustration Costa Rica ("sunshine abundant") tend to export bananas (sunshine-intensive products). The U.S. (a wheat-land -abundant country) does certainly export wheat (a wheat-land intensive product). Actually, ever since the early 1980s, the Leontieff Paradox wasn't found to describe the U.S. trade data therefore ratifying the H.O. theory.


Related Discussions:- Heckscher-ohlin theory

Balance of payments accounts, Q. "The balance of payments accounts seldom b...

Q. "The balance of payments accounts seldom balance in practice." Discuss. Answer: True the major reasons are due to the fact that data received or collected from different so

#title.circular flow of income of an open economy., illustrate the circular...

illustrate the circular flow of income of an open economy and explain the effects of various injections and withdrawal in the circular flow?

Terms of trade, what is net barter terms of trade and the effect on its eco...

what is net barter terms of trade and the effect on its economy

Balance of payments deficits, Q. Refute the claim by mercantilists who clai...

Q. Refute the claim by mercantilists who claimed that without severe restrictions on international trade and payments, a country might find itself impoverished and without an adequ

What quantity could it sell at what price, Q. The figure below shows the d...

Q. The figure below shows the demand and cost functions facing a Brazilian Steel producing monopolist. If it were unable to export, and was constrained by its domestic market, wh

Exchange rate determination, Q. Describe the chain of events leading to exc...

Q. Describe the chain of events leading to exchange rate determination for the following cases: 1. An increase in the U.S money supply 2. An increase in the growth rate of the

Explain the partial globalization of international finance, Explain the Par...

Explain the Partial Globalization of International Finance

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd