â â â â â â  â  abstract â  outward-oriented economies seem to grow faster than inward-looking ones. does the literature on convergence have anything to say on this? in the dynamic heckscher-ohlin-samuelson model, with factor-price equalization, there is no convergence of incomes. this is because with identical preferences and return to capital, irrespective of initial levels the growth rates o...

In this work, I construct an extended model of the Heckscher-Ohlin model, in which there is an assignment problem of how to assign workers to two types of endowments, skilled and unskilled labor. In the comparative statics for a small open economy, when product prices change, the outputs change more than in the HeckscherOhlin model. In the comparative statics for a whole economy, when consumer ...

This paper develops a two country endogenous growth model with accumulation of both physical and human capital. We establish the existence of two country balanced growth equilibria with physical and human capital growing at the same rate in which a static and dynamic version of the Heckscher-Ohlin hypothesis hold true. We also show the existence of unbalanced growth equilibria in which the stat...

Many previous tests of Heckscher-Ohlin trade theory have found underwhelming support for the idea that countries’ endowments determine their production and trade. This paper demonstrates that those efforts suffer from their focus on the narrower of the model’s two potential equilibria, which assumes that all countries produce all goods. In this paper we introduce a more general technique for te...

The Heckscher-Ohlin model with arbitrary number of goods, factors and countries (consumers) and no restrictions on factor trading is shown to be equivalent to an exchange model whose goods are the productive factors while consumer’s indirect demands for factors are derived from their actual demands for consumption goods. This equivalence enables one to import properties like the pathconnectedne...

In a two-cone Heckscher–Ohlin model with CES preferences and a continuum of goods, new northern goods increase the northern skill premium if they are skilled-labor intensive, and may increase the premium if they are unskilled-labor intensive. Thus, the introduction of new goods into US technology could have done more to increase the US skill premium than a closed-economy model would predict. I ...

Previous empirical tests have found that,contrary to the conclusions of the HeckscherOhlin model, the factor composition of traded goods fails to reveal relative factor abundance rankings. Using a nonparametric approach, this paper discusses the refutability of two of the assumptions of the HO model: that countries have identical homothetic preferences and identical constant returns to scale pr...

Eli Heckscher (1919) and Bertil Ohlin (1933) laid the groundwork for substantial developments in the theory of international trade by focusing on the relationships between the composition of countries’ factor endowments and commodity trade patterns as well as the consequences of free trade for the functional distribution of income within countries. From the outset general equilibrium forms of a...