Estimating the HOV Model with Technology Differences Using Disaggregated Labor Skills for the United States and the United Kingdom

Keith Maskus and Allan Webster

Review of International Economics, 1999, vol. 7, issue 1, 8-19

Abstract: The paper develops a version of the Heckscher-Ohlin-Vanek (HOV) theorem of parametric technological differences for application to US and UK data on the factor contents of trade, output, and consumption. A matched set of input-output tables, consumption and trade vectors, and labor occupations is constructed. The data allow estimation of factor-specific and industry-specific productivity differences for incorporation into a second-stage econometric approach to assessing the HOV model. The data support a general model with technical differences and measurement error. The implied ratio of US-to-UK expenditure levels exceeds the ratio based on published GNP data. Copyright 1999 by Blackwell Publishing Ltd.

Date: 1999
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