Comparative Costs, the Invisible Hand, and Factor Endowments: Ricardo, Ohlin, and Samuelson
The Ricardian principle of ‘comparative advantage’ refers to relative costs (relative autarky prices) compared to another country. The relative cost (price) functions can be obtained directly from specified cost functions with global regularity properties. We derive the CES relative cost function with two primary factor prices. The Stolper-Samuelson Theorem is embedded in relative cost functions and their numerical inelasticity property. Factor price equalization represents extreme parametric versions of the relative cost functions. Moreover a relative cost function connects isoquant tangents of contract curves with the tangents (shape) of production possibility curves. The CES relative cost function is combined with Ohlin‘s ‘mutual-interdependence theory of pricing’ in solving the Walrasian general equilibrium system.
|Date of creation:||Sep 2011|
|Contact details of provider:|| Postal: Niels Bohrs Vej 9, 6700 Esbjerg|
Phone: +45 6550 2233
Fax: +45 6550 1090
Web page: http://degit.sam.sdu.dk/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- H. Uzawa, 1963. "On a Two-Sector Model of Economic Growth II," Review of Economic Studies, Oxford University Press, vol. 30(2), pages 105-118.
- N/A, 1967. "Summary," National Institute Economic Review, National Institute of Economic and Social Research, vol. 42(1), pages 3-3, November.
- Bagicha S. Minhas, 1962. "The Homohypallagic Production Function, Factor-Intensity Reversals, and the Heckscher-Ohlin Theorem," Journal of Political Economy, University of Chicago Press, vol. 70, pages 138-138.
- N/A, 1967. "Summary," National Institute Economic Review, National Institute of Economic and Social Research, vol. 41(1), pages 3-3, August.
- N/A, 1967. "Summary," National Institute Economic Review, National Institute of Economic and Social Research, vol. 39(1), pages 3-3, February.
- Ricardo, David, 1821. "On the Principles of Political Economy and Taxation," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, edition 3, number ricardo1821.
- Shoven,John B. & Whalley,John, 1992.
"Applying General Equilibrium,"
Cambridge University Press, number 9780521266550.
- Shoven,John B. & Whalley,John, 1992. "Applying General Equilibrium," Cambridge Books, Cambridge University Press, number 9780521319867.
- N/A, 1967. "Summary," National Institute Economic Review, National Institute of Economic and Social Research, vol. 40(1), pages 3-3, May.
- Opp, Marcus M. & Sonnenschein, Hugo F. & Tombazos, Christis G., 2009. "Rybczynski's Theorem in the Heckscher-Ohlin World -- Anything Goes," Journal of International Economics, Elsevier, vol. 79(1), pages 137-142, September. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:deg:conpap:c016_042. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jan Pedersen)
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 references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.