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The Leontief Paradox: Continued or Resolved?
Journal of Political Economy (1985)
  • Francois R. Casas, University of Toronto
  • E. Kwan Choi, University of Missouri
An important corollary of the Heckscher-Ohlin-Vanek model of international trade is that under balanced trade a country will be a net exporter of the services of its abundant factors and a net importer of the services of its scarce factors, where abundance and scarcity are defined in terms of a factor-price-weighted average of all resources. Thus, if K, and Km denote the amounts of capital services embodied exports and imports, respectively, and Lx and L,, the corresponding amounts of labor services, then K, > K, and Lx < Lm, if capital is abundant and labor is scarce, implying that K!IL, > Km/LM
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Copyright 1985 The University of Chicago
Citation Information
Francois R. Casas and E. Kwan Choi. "The Leontief Paradox: Continued or Resolved?" Journal of Political Economy Vol. 93 Iss. 3 (1985) p. 610 - 615
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