Over the years, empirical studies show that the factor proportions approach:
A) is rather robust at explaining patterns of international trade.
B) completely fails to explain patterns of trade.
C) yields useful insights for particular types of trade, such as primary commodities.
D) is superior to any other explanation of international trade patterns.

Question

Quizplus · Accepted Answer

The factor proportions approach, also known as the Heckscher-Ohlin model, provides useful insights particularly for trade involving primary commodities, where differences in factor endowments are more pronounced. However, it is not universally robust for all types of trade.

Over the Years, Empirical Studies Show That the Factor Proportions