What theory argues that free trade is beneficial, but that differences in factor endowments, not productivity, determine the pattern of international trade? Heckscher-Ohlin Leontief Ricardo Porter-Friedman

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Business

Bailey Esparza

17 July, 15:33

What theory argues that free trade is beneficial, but that differences in factor endowments, not productivity, determine the pattern of international trade? Heckscher-Ohlin Leontief Ricardo Porter-Friedman

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Melanie Walsh · Answer 1

The correct answer is letter "A": Heckscher-Ohlin.

Explanation:

Named after Swedish economists Eli Heckscher (1879-1952) and Bertil Ohlin (1899-1979), the Heckscher-Ohlin theory states that countries should focus their efforts on producing and exporting those goods they are good at manufacturing and they should import the goods they struggle in making. The concept is based on both the productivity and non-productivity of nations and their best bequests.