Term
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Definition
| (Comparative Advantage) - Single factor - Long run - Everyone benefits from trade - Complete Specialization - Wages don't equalize with increased factors |
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Term
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Definition
(Cluster Fuck)
- Focuses on factor increase/decrease
- Short run
- Allows for distributional effects
- Winners and losers exist
- Ambiguous gains are made |
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Term
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Definition
(Factor Abundance)
- Focuses on mobile factors
- Long run
- Allows for distributional effects
- Factor used heavily in exports will gain |
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Term
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Definition
| Country exports good that uses the abundant factor (pattern of trade) |
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Term
| Stolper-Samuelson Theorem |
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Definition
| In long run, an increase in the relative price of a good will increase real earnings of the factor used intensively for it (who wins/loses) |
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Term
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Definition
| An increase in a factor will increase output of the good that uses it intensively in the long run (factor ups and downs) |
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Term
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Definition
Refutes Heckscher-Olin Theorem
- Doesn't distinguish between skilled and unskilled labor |
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Term
| TAA (Trade Adjustment Assistance) |
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Definition
| Gives work training, stipends, jobs to those who have lost their jobs due to foreign trade |
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Term
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Definition
| Trading in an honorable and charitable manner with developing countries who produce raw materials and staples |
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