International Trade Agreements

Rybczynski Theorem
This theorem is a property of the Heckscher-Olin Model, stating that, at constant prices, an increase of factor endowments will facilitate an increase in the production in an industry which uses that factor intensely. (i.e. Newly discovered caches of diamonds in South Africa would lead to increased diamond exportation. This could lead to less productivity in other industries. Suppose that due to a fixed level of employable people the diamond mines paid more for labor, laborers would move to that industry and abandon their previous positions.)
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