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1. Wage ratios must lie in between the inter-country productivity ratios.
2. Large countries are always less specialized.
3. Low wage countries have bigger gains from trade.
HECKSCHER-OHLIN MODEL:
1. Labor in a labour-abundant country will favour free trade.
2. Rise in labor supply has no effect on wage rates in the Heckscher Ohlin model.
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evaluation of strategic business management
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