Rybczynski Theorem


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Rybczynski Theorem

The concept that, assuming constant prices, an increase in an endowment will result in increased output of a product using that endowment and reduced output for another product. The theorem was developed by Tadeusz Rybczynski in 1955.
References in periodicals archive ?
More broadly, the Rybczynski Theorem assumes fully employed global and domestic resources at invariant domestic relative factor and goods prices.
Despite the level of abstraction required for unambiguous results from the Rybczynski Theorem, a germ of truth emerges: rapidly growing, large countries are sensitive to the implications for their terms of trade arising from rapid increases in factor endowments.
As capital flows in, the Rybczynski Theorem tells more of good 1 will be produced, shrinking imports.
By the Rybczynski theorem, industry Y (K-intensive) expands while industry X (L-intensive) declines, both relatively and absolutely.
k] (i = [alpha], [beta]) follows directly from the Rybczynski theorem, i.