WK4_8Sept_Ch_4_corrected

WK4_8Sept_Ch_4_corrected - Continue with Chapter 4 Trade:...

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Unformatted text preview: Continue with Chapter 4 Trade: Factor Availability and Factor Proportions are Key Week 4 (Thursday, Sept. 8, 2011) Heckscher-Ohlin Model Pattern of Trade and Gains from Trade 1. Factor abundance and factor intensity 2. Increasing opportunity cost & slope of PPC 3. Incomplete specialization 4. Pattern of trade predictions 5. Trade Triangle (exports and imports) 6. CPC with trade Income Distribution Effects 7. Short Run, Medium Run, Long Run 8. Long run: Stolper-Samuelson Theory B a s k e t A : Q w = 2 2 , Q c = 0 B a s k e t B : Q w = 2 1 , Q c = 6 W H E A T A B - 1 W C : Q w = 1 9 , Q c = 1 0 D : Q w = 1 5 , Q c = 1 6- 4 W E : Q w = 1 3 , Q c = 2 0 F : Q w = 0 , Q c = 2 6- 1 3 W + 6 C + 6 C + 6 C C L O T H T h e s l o p e o f t h e P P C i s t h e m a r g i n a l c o s t o f a n e x t r a u n i t o f C . S l o p e i n t h e r e g i o n o f A = - 1 W : + 6 C P c / P w = 1 / 6 W p e r C S l o p e i n t h e r e g i o n o f C = - 4 W : + 6 C P c / P w = 4 / 6 W p e r C S l o p e i n t h e r e g i o n o f E = - 1 3 W : + 6 C P c / P w = 1 3 / 6 W p e r C I n a u t a r k y , t h e s l o p e e q u a l s a u t a r k y p r i c e o f c l o t h Heckscher-Ohlin or Factor Endowments Model Within a country Two Goods: C and W Each requires two resources to produce: labor (L C and L W ) and Land (T C and T W ) Stock of Labor: L Stock of Land: T Two New Concepts...
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This note was uploaded on 01/28/2012 for the course ECN 306 taught by Professor Croucher during the Fall '08 term at ASU.

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WK4_8Sept_Ch_4_corrected - Continue with Chapter 4 Trade:...

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