The empirical result that U.S. exports seem to be labor-intensive if only capital and labor are used as factors of production is known as the:
A) Leontief Paradox.
B) Smith's riddle.
C) Ricardo's advantage.
D) Krugman's puzzle.
E) None of the above

Question

Quizplus · Accepted Answer

The Leontief Paradox refers to the empirical finding by Wassily Leontief that, contrary to the expectations of the Heckscher-Ohlin theory, the United States (which was relatively capital abundant) exported labor-intensive commodities and imported capital-intensive commodities. This was surprising because the Heckscher-Ohlin theory predicted that countries would export goods that intensively use their abundant factors of production.

The Empirical Result That U