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- Title
On Factor Price Equalization when Commodities Outnumber Factors: A Note.
- Authors
Bertrand, Trent J.
- Abstract
This article talks about the relation of factors prices to the changes in production resulting from the introduction of free trade and the requirement of full employment of fixed factor supplies. The author determines whether increasing the number of commodities increases or reduces the probability of factor price equalization. It is noted that the larger the number of goods relative to the number of factors the more likely is free trade to lead to factor price equalization. A two-factor, three commodity and two-country model is used to further discuss the factor prize equalization.
- Subjects
COMMERCIAL products; FACTORS of production; PRODUCTION (Economic theory); COMMERCIAL policy; FREE trade; TERMS of trade
- Publication
Economica, 1970, Vol 37, Issue 145, p86
- ISSN
0013-0427
- Publication type
Article
- DOI
10.2307/2552006