Leontief Paradox


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Leontief Paradox

The concept that countries with a great deal of capital available import capital intensive commodities and export labor intensive commodities. This contradicts what one would expect: before the paradox was uncovered, economic theory held that countries would export according to their competitive advantages (that is, capital intensive countries would import labor intensive products and export capital intensive products). The Leontief paradox led to rejection or revision of the Heckscher-Ohlin theorem.
References in periodicals archive ?
Thus, the Leontief paradox was generated, as the United States, with the greatest endowment of capital, exported mostly labour intensive goods, while importing capital intensive commodities.
Following a long development of models that tried to construe trade based on production advantages and production factor endowment and subsequent to the onset of the Leontief paradox, the theory, first proposed by Staffan Burenstam Linder in 1961, asserted that the structure and similarities of demand found in world economies dictated larger flows of trade (Linder, 1961).
lt;<Factor endowments and trade of the United States and Taiwan: The Leontief paradox re-examined>>.
Hence, there is no Leontief Paradox in the United States for the period 1965-1991 in our framework.
Section IV presents the FCT for each factor and discusses the Leontief Paradox.
Thus, it is evident that, for this period, there is no Leontief Paradox in the U.
This today is called the Leontief Paradox as it seemingly violates the H-O Theorems proposition in that US exports should have been more labor intensive than its imports given the US was capital abundant at the time the studies were done.
The authors move from describing the popular reasoning to explain the Leontief paradox and the balance of jobs methods for assessing globalization effects on employment.
This famous result, dubbed the Leontief paradox, was to stimulate a number of doctoral dissertations in the U.
It also touches on the possible explanations of the Leontief Paradox and some recent extensions of the framework.
Perhaps the most widely known is the Leontief Paradox, associated with the rather startling results presented by Leontief (1953) that the trade pattern of the United States suggested that its export sectors were more labor-intensive than factor proportions found in its import-competing sectors.
Once again I ignore the Leontief Paradox in this catalogue.