Other articles where Leontief Paradox is discussed: Wassily Leontief: also is known for the “Leontief Paradox.” Economists had previously held that a country’s . The Leontief Paradox evoked a widespread response from academicians. Several attempts were made by them to either defend the paradox or discover its . 11 Oct Meeting 5 – Leontief Paradox (International Economics). 1. Leontief paradox Meeting 5; 2. Leontief paradox: intro • It is the result of Leontief’s.

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Login Through Your Library. Specifically, a lower interest results in a greater amount of leontief paradox capital in the export sector. The transition of the US economy from a wartime to a peacetime economy was not complete until the s. To perform the test, Leontief used the input-output table leontief paradox the US economy He received his Nobel prize for his contribution to input-output analysis later.

Thus, one can say that the above is a more general definition of factor abundance.

The Leontief paradox led to rejection or revision of the Heckscher-Ohlin theorem. That is, US exports would have been more leontief paradox than US imports. Related Content Related Overviews Wassily Leontief — human capital comparative advantage Leontief paradox Ricardo — political economist. A capital abundant country need not export the capital-intensive good if her tastes leonteif strongly biased toward the capital-intensive goods.

Leontief paradox

This trade leontief paradox means that US consumers must reduce consumption of all three goods proportionately due to homothetic preferences. While there has not been much empirical evidence about the possibility of leontlef intensity reversals, FIR is real.

These products were imported because the U. The focus is then on indirect factor trade. The journal publishes 11 issues containing articles on a broad leontief paradox of topics. Services tend to be nontraded leontief paradox. In his second study, Leontief pqradox industries into industries.


Trade theory is supposed to predict the patterns of output trade.

Leontief Paradox

At first, Leontief was criticized on statistical grounds. Custom alerts when new content is added. All these variables are intimately linked together and it is not possible to change one of them without changing all the others. If factor reversals exist, it is fully possible for a capital rich country to export its labour intensive goods.

But he argued that US exports were skilled labor- intensive than US imports. Bulls were worshiped by the Phoenicians and Canaanites in Palestine. South Korea Hong analyzed Leontief paradox trade patternwhich was consistent with the HO theory. Leontjef a country’s labor share is greater than leontief paradox share, it leontief paradox abundant in labor.

Always review your references and make any necessary leontief paradox before using. By using this site, you agree to the Terms of Use and Privacy Policy. Trade,” Indian Economic JournalOctober The question is whether FIR is common in the real world.

Japan’s parqdox trade pattern was inconsistent with HO. Suppose now that the US is maintaining a large trade surplus. Linear B tablet Omniglot with syllabaries, partly deciphered, similar to hiragana.

Leontief paradox Japan bridge fish market is leontie predecessor of today’s Leontief paradox fish market with over leohtief, employees. However, he argued that using factor-intensity of import- substitutes instead of actual imports did not alter his finding. Leontief was comparing factor-intensity of US exports with import substitutes of US and not leontief paradox its actual imports.

Therefore, in terms of H-O theory, it is expected that the US would export capital-intensive goods and import labour-intensive ones. Leontief paradox was possible paradx fact, highly likely that the US imports were labour-intensive in the countries of their origin.


Such situations make it difficult paraox assess the validity or otherwise of H-O theorem. While factories had been destroyed, the survivors were highly skilled workers, who were needed to export the capital-intensive goods. We cannot make a statement leontief paradox labor-abundant country will export the labor-intensive product” in a three-good, leontief paradox world because labor-intensity is not defined.

H-O theorem is based upon some highly simplified assumptions like perfect competition, and same technology, etc.

Thus, the EG case was consistent with the HO theory. William Travis argued that tariff may have been responsible for the LP. Retrieved from ” https: The Heckscher-Ohlin theory states that each country exports leontief paradox commodity which intensively uses its abundant factor.

Consumers develop a sweet tooth for labor-intensive goods as income increases. The country will still use more capital intensive methods in its export industries than any other country.

Factually, these assumptions do not hold good. It also touches on the possible explanations of the Leontief Paradox and some recent extensions leontief paradox the framework.

Stolper and Roskamp applied Leontief’s method to the trade pattern of East Germany. Therefore, consumption bias would have reinforced the HO prediction that US would import the leontief paradox goods.

Leontief paradox – Oxford Reference

Indian exports to the US were capital-intensive. Zfactor abundance can be ranked: References in periodicals archive? But still, if H-O leontief paradox was correct, its import-substitutes should be less capital-intensive than its exports.