Economics ETDs

Publication Date

5-1-1973

Abstract

International trade literature is well endowed with theorems and lemmas proved in the two-factor-two-commodity world. The Heckscher-Ohlin theorem, the Rybczynski theorem and the Stolper-Samuelson theorem, to name only the few essential results, have been proved for the 2x2 model. Attemps have been made to extend these results to dimensions higher than the two-factors and two-commodities. However, such attempts were devoid of “rigorous treatment".

In this thesis a system is devised to rank commodities according to factor intensities when three-factors are employed to produce three-commodities. Some of the results rigorously analyzed in the 2x2 model are extended to the 3x3 model. Moreover, the thesis employs the 3x3 model to analyze the cost of income redistribution when inter­national trade tools are employed for that purpose.

The thesis is divided into four chapters. The introduction, Chapter I, states the problem of the 3x3 model and reviews the 2x2 model.

Chapter II deals with the three-factor-three-commodity model. In section 1 the set of assumptions and definitions of the 3x3 model are stated. Some of these assumptions will be relaxed in subsequent analysis. In sections 2 and 3 I will derive the relationship between factor rewards and factor intensities, and factor rewards and commodity prices, respectively. The Rybczynski theorem and the Stolper­Samuelson theorem are extended to the 3x3 model in sections 4 and 5, respectively. Section 6 offers a model when capital rewards are fixed and the supply of capital is elastic.

Chapter III analyzes technical innovation in the 3x3 model. Section 1 states the implications of innovation on factor ratios, while section 2 analyzes the implications of innovation on income distribution.

The final chapter, Chapter IV, examines the cost of income redistribution in the 3x3 model. Section 1 deals with the effect of distortion on production. Two different assumptions are utilized in the analysis of this cost. Section 2 takes the case where capital is inelastic in supply, while section 3 takes the case of an elastic supply of capital.

Degree Name

Economics

Level of Degree

Doctoral

Department Name

Department of Economics

First Committee Member (Chair)

Gary C. Hufbauer

Second Committee Member

Franklin Lee Brown

Third Committee Member

Paul Jonas

Language

English

Document Type

Dissertation

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