________ looks to relative factor endowments to explain trade flows.
A) The Heckscher-Ohlin theorem
B) Ockham's razor
C) Say's law
D) The Sherman Antitrust Act

Question

Quizplus · Accepted Answer

The Heckscher-Ohlin theorem posits that countries will export goods that require resources (factors of production) that are abundant domestically and import goods that require resources that are relatively scarce. This theory contrasts with others by focusing on the differences in factor endowments between countries as the basis for trade.

________ Looks to Relative Factor Endowments to Explain Trade Flows