The Heckscher-Ohlin Model as an Aggregate
1983 (English)Report (Other academic)
This paper extends the results of Neary (1979) where it was shown that, when an appropriate aggregation procedure is adopted, many of the properties of the two-factor, two-commodity Heckscher-Ohlin model continue to hold in a general production model with any numbers of goods and factors. In the present paper it is shown that, if the number of goods and factors are the same (though still arbitrarily large) and if joint production and intermediate goods are ruled out, then the parallel between the properties of the standard Heckscher-Ohlin model and the aggregated model is greatly strenghtened. In particular, the equalization of factor prices between "similiar" free-trading economies and, with some additional restrictions, the "magnification" effects associated with the Rybczynski and Stolper-Samuelson theorems are shown to hold in the aggregated model.
Place, publisher, year, edition, pages
Stockholm: IIES , 1983. , 40 p.
Seminar Paper / Institute for International Economic Studies, Stockholm University, ISSN 0347-8769 ; 244
IdentifiersURN: urn:nbn:se:su:diva-41474OAI: oai:DiVA.org:su-41474DiVA: diva2:330422
Published in connection with a visit at the IIES2010-07-152010-07-152010-07-15