The Leontief paradox questioned the validity of the theory of
A) comparative advantage.
B) factor endowments.
C) overlapping demands.
D) absolute advantage.

Question

Quizplus · Accepted Answer

The Leontief paradox challenged the Heckscher-Ohlin theory (factor endowments theory) by finding that the U.S., which was relatively abundant in capital, exported labor-intensive goods and imported capital-intensive goods, contrary to the theory's predictions.

The Leontief Paradox Questioned the Validity of the Theory of