Robert E. Baldwin
- Published in print:
- 2008
- Published Online:
- August 2013
- ISBN:
- 9780262026567
- eISBN:
- 9780262267656
- Item type:
- book
- Publisher:
- The MIT Press
- DOI:
- 10.7551/mitpress/9780262026567.001.0001
- Subject:
- Economics and Finance, Econometrics
No names are more closely associated with modern trade theory than Eli Heckscher and Bertil Ohlin. The basic Heckscher–Ohlin proposition, according to which a country exports factors in abundant ...
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No names are more closely associated with modern trade theory than Eli Heckscher and Bertil Ohlin. The basic Heckscher–Ohlin proposition, according to which a country exports factors in abundant supply and imports factors in scarce supply, is a key component of modern trade theory. This book traces the development of the HO model, describing the historical twists and turns that have led to the basic modern theoretical model in use today. It not only presents a cohesive view of the model’s evolution but also reviews the results of empirical tests its various versions. The book surveys the development of the HO model and then assesses empirical tests of its predictions. Most discussions of empirical work on HO models confine themselves to the basic theorem, but the book devotes a chapter to empirical tests of three related propositions: the Stolper–Samuelson theorem; the Rybczynski theorem; and the factor price equalization theorem. It concludes that although the formulation and testing of these later models have improved economists’ understanding of the forces shaping international trade, many empirical trade economists (himself included) were so enamored of the elegant but highly unrealistic factor price equalization models developed from the insights of Heckscher and Ohlin that they have neglected investigation of other models without this relationship.Less
No names are more closely associated with modern trade theory than Eli Heckscher and Bertil Ohlin. The basic Heckscher–Ohlin proposition, according to which a country exports factors in abundant supply and imports factors in scarce supply, is a key component of modern trade theory. This book traces the development of the HO model, describing the historical twists and turns that have led to the basic modern theoretical model in use today. It not only presents a cohesive view of the model’s evolution but also reviews the results of empirical tests its various versions. The book surveys the development of the HO model and then assesses empirical tests of its predictions. Most discussions of empirical work on HO models confine themselves to the basic theorem, but the book devotes a chapter to empirical tests of three related propositions: the Stolper–Samuelson theorem; the Rybczynski theorem; and the factor price equalization theorem. It concludes that although the formulation and testing of these later models have improved economists’ understanding of the forces shaping international trade, many empirical trade economists (himself included) were so enamored of the elegant but highly unrealistic factor price equalization models developed from the insights of Heckscher and Ohlin that they have neglected investigation of other models without this relationship.
Patricia Clavin
- Published in print:
- 2013
- Published Online:
- May 2013
- ISBN:
- 9780199577934
- eISBN:
- 9780191744211
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199577934.003.0003
- Subject:
- History, World Modern History, Economic History
In 1929, international negotiations revealed widespread tensions over the operations of the reconstructed gold standard. There were signs the fixed exchange rate system was exerting a troubling ...
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In 1929, international negotiations revealed widespread tensions over the operations of the reconstructed gold standard. There were signs the fixed exchange rate system was exerting a troubling deflationary impact on some economics and the accumulation of substantial, and potentially destabilizing, gold reserves in others. In response, the League launched an Enquiry into the Gold Standard that identified shortcomings in the system's operation and revealed, in its Minority Report and the case made privately by the secretariat, its increasingly critical perspective of the system. In 1931 it also launched the first of a series of important studies into the operation of business cycles under the charge of Bertil Ohlin. Big changes in the political world shaped this expanding workload, including the election of Herbert Hoover and subsequently Franklin Roosevelt as US presidents, and the formation of National Government in Britain and its subsequent departure of the gold standard.Less
In 1929, international negotiations revealed widespread tensions over the operations of the reconstructed gold standard. There were signs the fixed exchange rate system was exerting a troubling deflationary impact on some economics and the accumulation of substantial, and potentially destabilizing, gold reserves in others. In response, the League launched an Enquiry into the Gold Standard that identified shortcomings in the system's operation and revealed, in its Minority Report and the case made privately by the secretariat, its increasingly critical perspective of the system. In 1931 it also launched the first of a series of important studies into the operation of business cycles under the charge of Bertil Ohlin. Big changes in the political world shaped this expanding workload, including the election of Herbert Hoover and subsequently Franklin Roosevelt as US presidents, and the formation of National Government in Britain and its subsequent departure of the gold standard.
