IPE!

The amount of land, labour and capital a country has available

• national production storage

• factor endowments

• national treasury

• commodity reserves

politics of trade policy: capital VS labour

• constructivist model

• factor model

• sector model

• marxist model

politics of trade policy: import industries VS export industries

• marxist model

• sector model

• liberal economic model

• factor model

• capitalist model

In open economies, international trade eventually causes the price of factors of production to equalise. scare factors will fall into place. this is the:

• Pecuniary External Economies

• Samuelson Theorem

• the Factor Model

• Prebsich-Singer

• Hecksher-Ohlin Model

Scarce factors will ______ in price

Answer explanation

this is a part of the factor-price equalisation: while abundant factors will rise in price, scare factors will fall in price. (｡•́︿•̀｡)

eventually the price of labour-labour & capital-capital will be the same

Argues that comparative advantages arise from cross-national differences in factor endowment

• hecksher-ohlin model

• samuelson theorem

• prebish-singer model

• pareto suboptimal theory

• structuralism

Answer explanation

The Heckscher-Ohlin model evaluates the equilibrium of trade between two countries that have varying specialties and natural resources. The model explains how a nation should operate and trade when resources are imbalanced throughout the world. ✰✰✰✰✰✰✰✰✰

what is the meaning of pareto suboptimal?

• a status quo in which at least one member of society can be made better off without making anyone worse

• claim that the relative price of primary commodities in terms of manufactures shows a downward trend

• the development of domestic capabilities to produce 'easy goods'

• industry that increases demand for other industries

countries at an earlier stage of development tend to export a narrower range of products.

• primary product dependency

• factor endowments

• sector model

• Pecuniary External Economies

• the extractive model

what does ISI stand for?

Answer explanation

states industrialise by trading domestic goods for previously imported manufactured items (still import machinary)

what are the 2 subsets of ISIs?

• manufactured

• secondary

• easy

• primary

• singular

Answer explanation

EASY ISI - 1st Stage ➺ developing domestic capability to produce 'easy goods' e.g. canned goods, fabric, sauces

SECONDARY ISI - 2nd Stage ➺ developing domestic capability of production to focus on 'durable goods' advanced. e.g. steel, cars, computers, heavy duty machinery