Heckscher–Ohlin Theory (1)

Takashi Negishi and Takashi Negishi
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Takashi Negishi: The Japan Academy
Takashi Negishi: The University of Tokyo

Chapter Chapter 10 in Developments of International Trade Theory, 2014, pp 75-80 from Springer

Abstract: Abstract In the classical theory of international trade, the comparative advantage in the sense of the comparative costs is simply given exogenously. In other words, it is presupposed that different countries have different technology of production, which includes the difference in natural conditions for the production like the climate. In the modern theory of international trade, however, it is assumed that different countries have the identical technology which is given in the form of the identical production function. The comparative advantage of the different countries is explained, then, not by the difference in technology, but by the difference in the factor endowments. Such a modern theory is generally known as Heckscher–Ohlin theory, because the groundwork for substantial developments in the theory is laid by Eli Heckscher (1919) and Bertil Ohlin (1933).

Keywords: Comparative advantage; Heckscher Ohlin theory; Factor endowments (search for similar items in EconPapers)
Date: 2014
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DOI: 10.1007/978-4-431-54433-3_10

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