BILATERAL HECKSCHER-OHLIN THEOREM MODEL AND THE PATTERN OF GREECE’S TRADE WITH THE OTHER EU COUNTRIES
Keywords:
Heckscher-Ohlin Theorem, Greece, EUAbstract
In this article the Heckscher-Ohlin (H-O) Theorem in its «factor content» version is found to be valid under the existence of non-factor price equalisation conditions in the bilateral trade between two countries, in a model with three countries and many commodities. Further, the H-0 Theorem is examined in the trade between Greece and the European Union (EU) countries. It is found that the differences in the pattern of specialisation in the trade between Greece and each of the EU countries is explained by differences in the relative factor endowments. The tests suggest that the H-0 Model is valid in the trade between Greece and the EU countries.
References
Brecher, A. - Choudhri, EU (1982), «The Factor Content of International Trade without Factor-Price Equalisation», Journal of International Economics, 12:277-283.
Brecher, A. - Choudhri, EU (1988), «The Factor Content of Consumption in Canada and the United States: A Two-Country Test of the Heckscher-Ohlin-Vanek Model», in Feenestra,R.C., (eds), Empirical Methods for International Trade, MIT Press: Cambridge Mass.
Clifton, D. S. - Marxsen, W. B. (1984), «An Empirical Investigation into the Heckscher-Ohlin Theorem», Canadian Journal of Economics, 17: 32-38.
Courakis, A. S - Moura-Roque, F. (1992), «Comparative Advantage and Structural Change in the Portuguese Pattern of Trade in Manufactures», in Amaral, J. F.- Lucena, D. - Mello, A. S. (eds), The Portuguese Economy Towards 1992, Kluwer Academic Publishers: Dordrecht, pp. 233-255.
Deardorff, A. V. (1982), «The General Validity of the Heckscher-Ohlin Theorem», American Economic Review, 72: 683-964.
Deardorff, A. V. (1984), «Testing Trade Theories and Predicting Trade Flows», in Jones, R. W. - Kenen, P. B. (eds), Handbook of International Economics, Elsevier, vol. I, pp. 467-517.
Elmslie, B. - Milberg, W. (1992), «International Trade and Factor Intensity Uniformity: An Empirical Assessment», Weltwirtschaftliches Archiv, 128: 464-486.
Eurostat (1988), External Trade Data-Nace Classification, External Trade Statistics: Brussels-Luxemburg.
Eurostat (1988), Main Economic Indicators, Luxemburg.
Eurostat (1985-1990), Industrial Trends, Luxemburg.
Eurostat (1990), Input-Output Tables 1985, National Accounts ESA, Brus-sels-Luxemburg.
Harkness, J. (1978), «Factor Abundance and Comparative Advantage», American Economic Review, 68: 784-800.
Heckscher, E. (1919), «The Effect of Foreign Trade on the Distribution of Income», Ekonomisk Tidskrift, 21: 1-32.
Helpman, E. (1984), «The Factor Content of Foreign Trade», Economic Journal, 94: 84-94.
Helpman, E. (1998), «Explaining the Structure of Foreign Trade: Where Do We Stand?», Weltwirtschaftliches Archiv, 134: 573-589.
Horiba, Y. (1974), «General Equilibrium and the H-0 Theorem of Trade: The multi-country case», International Economic Review, 15: 440-449.
James, A. M. - Elmslie, B. (1996), «Testing Heckscher-Ohlin-Vanek in the G-7», Weltwirt-schaftliches Archiv, 132: 139-159.
Jones, R. W. (1956), «Factor Proportions and the Heckscher-Ohlin Theorem», Review of Economic Studies, 24: 1-10.
Learner, E. (1984), Sources of International Comparative Advantage, MIT Press: Cambridge, Mass.
Learner, E. (1993), «Factor-Supply Differences as a Source of Comparative Advantage», American Economic Review, 83: 436-439.
Learner, E. (1995), «The Heckscher-Ohlin Model in Theory and Practice», Princeton Studies in International Finance, No 77, Princeton University, pp. 1-50.
Leontief, W. W. (1953), «Domestic Production and Foreign Trade; The American Capital Position Re-examined», American Philosophical Society: Papers and Proceedings, 97: 332-349.
Leontief, W. W. (1956), «Factor Proportions and the Structure of American Trade: Further Theoretical and Empirical Analysis», Review of Economics and Statistics, 38: 386-407.
Nehru, V. - Drareshwa, A. (1992), «A New Database on Physical Capital Stock: Sources, Methodology and Results», World Bank working papers.
O.E.C.D. (1960-1989), Detailed Tables, National Accounts, Paris.
Ohlin, B. (1933), Interregional and International Trade, Harvard University Press: Cambridge, Mass.
Polychronoloulos, G. - Korres, G. - Rigas, G. (2001), «Globalisation, Direct Investment and Productivity Growth», 51 International Atlantic Economic Conference, Athens.
Rassekh, F. - Thomson, H. (1993), «Factor Price Equalisation: Theory and Evidence», Journal of Economic Integration, 8: 1-32.
Samuelson, P. A. (1953(54), «Prices of Factors and Goods in General Equilibrium», Review of Economic Studies, 21: 1-20.
Treffer, D. (1993), «International Factor Price Differences: Leontief was Right», Journal of Political Economy, 101: 961-985.
Tsounis, N. K. (1992), The Effects of European Economic Integration on the Greek Economy and the Pattern of Greek International Trade, Unpublished Ph.D. Thesis submitted to the University of Manchester.
Tsounis, N. (1996), «The Factor Content of Greek Trade with Other EU Countries», Greek Economic Review, 18: 1-22.
Tsounis, N. (2000), «Testing the Heckscher-Ohlin Theory in the Trade between Greece and the EU International Review of Economics and Business, 47:295-315.
Vanek, J. (1968), «The Factor Proportions Theory: the N-Factor Case», Kyk-los, 21: 749-756.
United Nations (1963-1989), Industrial Statistics Yearbook, New York.
United Nations (1977-1984), Yearbook of National Accounts Statistics, International Tables, New York.
Downloads
How to Cite
Issue
Section
License
Authors who publish with this journal agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
- Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access).
