IDEAS home Printed from https://ideas.repec.org/a/taf/jeduce/v40y2009i4p422-436.html
   My bibliography  Save this article

Pushing Economies (and Students) Outside the Factor Price Equalization Zone

Author

Listed:
  • Paul Oslington
  • Isaac Towers

Abstract

Despite overwhelming empirical evidence of the failure of factor price equalization, most teaching of international trade theory (even at the graduate level) assumes that economies are incompletely specialized and that factor price equalization holds. The behavior of trading economies in the absence of factor price equalization is not well understood, and some major textbook treatments err. The authors map regions of specialization and diversification for standard competitive economies and show how outputs, goods, and factor prices change as economies move within and across different regions of diversification and specialization. Two examples of how the analysis can enrich graduate-level trade teaching are given: the substitutability of goods trade and factor movements, and debates over the trade and inequality.

Suggested Citation

  • Paul Oslington & Isaac Towers, 2009. "Pushing Economies (and Students) Outside the Factor Price Equalization Zone," The Journal of Economic Education, Taylor & Francis Journals, vol. 40(4), pages 422-436, October.
    • Handle: RePEc:taf:jeduce:v:40:y:2009:i:4:p:422-436
    DOI: 10.1080/00220480903238099
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/00220480903238099
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/00220480903238099?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Borjas, George J. & Freeman, Richard B. (ed.), 1992. "Immigration and the Work Force," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226066332, September.
    2. Leamer, E.E., 1995. "The Heckscher-Ohlin Model in Theory and Practice," Princeton Studies in International Economics 77, International Economics Section, Departement of Economics Princeton University,.
    3. Paul Oslington, 2006. "The Theory of International Trade and Unemployment," Books, Edward Elgar Publishing, number 4244.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Paul Oslington & Isaac Towers, 2010. "Trade, Migration, and Inequality in a World without Factor Price Equalization," Review of International Economics, Wiley Blackwell, vol. 18(4), pages 650-662, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rodolfo Helg & Riccardo Faini & Anna M. Falzoni & Marzio Galeotti & Alessandro Turrini, 2001. "Importing Jobs And Exporting Firms? On The Wage And Employment Implications Of Italy’S Trade And Foreign Direct Investment Flows," International Trade 0103001, University Library of Munich, Germany.
    2. Card, David, 2001. "Immigrant Inflows, Native Outflows, and the Local Labor Market Impacts of Higher Immigration," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 22-64, January.
    3. Rita A. Balaban & James Harrigan, 1999. "U.S. wages in general equilibrium: the effects of prices, technology and factor supplies, 1963-1991," Staff Reports 64, Federal Reserve Bank of New York.
    4. Noel Gaston & Douglas R. Nelson, 2013. "Bridging Trade Theory And Labour Econometrics: The Effects Of International Migration," Journal of Economic Surveys, Wiley Blackwell, vol. 27(1), pages 98-139, February.
    5. Peter Huber & Helmut Hofer, 2001. "Teilprojekt 9: Auswirkungen der EU-Erweiterung auf den österreichischen Arbeitsmarkt," WIFO Studies, WIFO, number 19839.
    6. Lawrence F. Katz, 1994. "Active labor market policies to expand employment and opportunity," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, issue Jan, pages 239-322.
    7. Marek Rojíček, 2010. "Konkurenceschopnost obchodu ČR v procesu globalizace [Competitiveness of the Trade of the Czech Republic in the Process of Globalisation]," Politická ekonomie, Prague University of Economics and Business, vol. 2010(2), pages 147-165.
    8. David C. Maré & Steven Stillman, 2010. "The Impact of Immigration on the Geographic Mobility of New Zealanders," The Economic Record, The Economic Society of Australia, vol. 86(273), pages 247-259, June.
    9. Cristiano Perugini & Gaetano Martino, 2008. "Income Inequality Within European Regions: Determinants And Effects On Growth," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 54(3), pages 373-406, September.
    10. Nathalie Chusseau & Joël Hellier, 2012. "Globalisation and Inequality: Where do we stand?," Journal of Income Distribution, Ad libros publications inc., vol. 21(3-4), pages 7-34, November.
    11. Helge Berger & Frank Westermann, 2001. "Factor price equalization? The cointegration approach revisited," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 137(3), pages 525-536, September.
    12. Rickard Sandell, 2008. "A Social Network Approach to Spanish Immigration: An Analysis of Immigration into Spain 1998-2006," Working Papers 2008-33, FEDEA.
    13. Rashid, Saman, 2004. "Immigrant Earnings, Assimilation and Heterogeneity," Umeå Economic Studies 622, Umeå University, Department of Economics.
    14. Andrés Rodríguez-Pose & Viola von Berlepsch, 2012. "When migrants rule: the legacy of mass migration on economic development in the US," Papers in Evolutionary Economic Geography (PEEG) 1216, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Aug 2012.
    15. Longva, Pal, 2001. "Out-migration of immigrants : implications for assimilation analysis," Memorandum 04/2001, Oslo University, Department of Economics.
    16. Gianmarco I.P. Ottaviano & Giovanni Peri, 2005. "Rethinking the Gains from Immigration: Theory and Evidence from the U.S," NBER Working Papers 11672, National Bureau of Economic Research, Inc.
    17. Bernard, Andrew & Redding, Stephen & Simpson, Helen & Schott, Peter, 2002. "Factor Price Equalization in the UK?," CEPR Discussion Papers 3523, C.E.P.R. Discussion Papers.
    18. Peter K. Schott, 2003. "One Size Fits All? Heckscher-Ohlin Specialization in Global Production," American Economic Review, American Economic Association, vol. 93(3), pages 686-708, June.
    19. Williamson, Jeffrey G, 1997. "Globalization and Inequality, Past and Present," The World Bank Research Observer, World Bank, vol. 12(2), pages 117-135, August.
    20. Abdurrahman Aydemir & George J. Borjas, 2011. "Attenuation Bias in Measuring the Wage Impact of Immigration," Journal of Labor Economics, University of Chicago Press, vol. 29(1), pages 69-113, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:jeduce:v:40:y:2009:i:4:p:422-436. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/VECE20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.