Variable labour supply and the pure theory of international trade: an empirical note
Previous writers have shown that variable labour supply may lead to perverse price output responses in the two-sector Heckscher-Ohlin model. This note attempts to assess the empirical likelihood, as opposed to the theoretical possibility, of such perversities. Using a range of plausible parameter va...
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| Format: | Journal article |
| Jezik: | English |
| Izdano: |
North Holland Publishing Company
1980
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| Teme: |
| Izvleček: | Previous writers have shown that variable labour supply may lead to perverse price output responses in the two-sector Heckscher-Ohlin model. This note attempts to assess the empirical likelihood, as opposed to the theoretical possibility, of such perversities. Using a range of plausible parameter values, we conclude that cases of a perverse price-output response consistent with dynamic stability of the model, though theoretically possible, are unlikely to arise in practice. |
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