PSCI 3328 Lecture Notes - Lecture 21: Factor Endowment, Human Capital, Free Trade

30 views2 pages
25 Jan 2017
School
Course
Professor

Document Summary

Economy is viewed in terms of factor endowment: land. Us has a lot of land, japan does not. States will export goods that make intensive use of their abundant factors: based on this model, us is expected to export agriculture products since this is what they have abundant numbers of. States will import goods that make intensive use of their scarce factors. State will use trade protection to benefit the scarce factor of production. Main purpose is to predict support/opposition of trade barriers: owners of scarce factor support protectionism. Japanese farmers, due to scarce land, will support protectionism: owners of abundant factor support free trade. Those with abundant sources will want free trade and not be cut off or limited by the protection for the ones with scarce sources. Trade is broken into sections which use the various factors of production. Land, labor, and capital are all still important, but sector is more important: also called specific-factors model.

Get access

Grade+20% off
$8 USD/m$10 USD/m
Billed $96 USD annually
Grade+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
40 Verified Answers
Class+
$8 USD/m
Billed $96 USD annually
Class+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
30 Verified Answers

Related Documents