Income distribution effects of trade, International Economics

Assignment Help:

Q. "The H.O. model remains useful as a way to predict the income distribution effects of trade." Discuss.

Answer: The Stolper-Samuelson theorem, one of the basic theorems arising from the Heckscher-Ohlin model yields an elegant demonstration of the fact that changes in product prices such as will take place when trade is expanded or curtailed telescopes its effects onto factor prices thus that not only do relative factor returns mirror product prices however that actual returns to factors may either rise or fall in real terms. Therefore as a policy framework the disproportionate effect trade may have on real incomes of sectors such as skilled-labor is quite useful both theoretically and practically (or polemically).

1338_Income distribution effects of trade.png


Related Discussions:- Income distribution effects of trade

Relative capital abundance, Q . Consider that the relative capital abundanc...

Q . Consider that the relative capital abundance of Australia was so much greater than that of Sri-Lanka, that we would have to locate Australia far to the right on the K/L axis.

Explain theoretical and methodological aspects , Explain Theoretical and me...

Explain Theoretical and methodological aspects of international economic relations

Export finance, role of export import bank of india

role of export import bank of india

Migration model of todaro and harris, Q. The migration model of Todaro and...

Q. The migration model of Todaro and Harris provided an important theoretical critique of the manufacturing-biased import-substitution trade-policy stance. Illustrate. Answer:

Income distribution effects of trade, Q. "The H.O. model remains useful as...

Q. "The H.O. model remains useful as a way to predict the income distribution effects of trade." Discus s. Answer: The Stolper-Samuelson theorem, one of the basic theorems ari

How were the initial members of emu chosen, Q. How were the initial members...

Q. How were the initial members of EMU chosen? How will new members be admitted? What is the structure of the complex of financial and political institutions that govern economic

Stolper samulson theorum, is the stolper samulson theorem is relevant in t...

is the stolper samulson theorem is relevant in these days

#title opportunity cost theory, review the general equilibrium conditions u...

review the general equilibrium conditions under autarky and given free trade using the opportunity cost theory of trade

Economics, discuss the central economic problem facing this group of surviv...

discuss the central economic problem facing this group of survivors.

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