Compared to the Heckscher-Ohlin model, all other things equal, the fixed-factors model shows that a shift to free trade expands the volume of trade:

Question

Quizplus · Accepted Answer

The fixed-factors model, compared to the Heckscher-Ohlin model, typically shows that a shift to free trade expands the volume of trade less. This is because the fixed-factors model incorporates limitations on the mobility of factors of production across sectors, which can restrict the extent of trade expansion by limiting the economy's ability to re-allocate resources in response to changes in trade policy.

Compared to the Heckscher-Ohlin Model, All Other Things Equal, the Fixed-Factors