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The Rybczynski Theorem (With Criticisms) | International Economics

In this article we will discuss about the Rybczynski theorem of international trade with its criticisms. In both Heckscher-Ohlin theory and the factor- price equalisation theory, the assumption was taken that the factor endowments were fixed. T.M. Rybczynski, published a paper in 1955 to investigate the effect of an increase in the quantity of a […]

The Rybczynski Theorem (RT) (With Diagram) | Economics

The Rybczynski Theorem (RT) says that if the endowment of some resource increases, the industry that uses that resource most intensively will increase its output while the other indus­try will decrease its output. The relative factor intensity is measured by the ratio of factor use in each industry. The theorem suggests that unbalanced growth in […]

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