68.7k views
1 vote
U.S. exports are less capital-intensive than U.S. imports, despite the relative abundance of capital in the country. This is in opposition to the Heckscher-Ohlin theory and has been labelleda. a zero-sum game.b. Leontief's paradox.c. a positive-sum game.d. Samuelson's critique.e. a first-mover advantage.

User Glennular
by
8.3k points

1 Answer

5 votes

Answer:

The correct answer is option b.

Step-by-step explanation:

According to the Heckscher-Ohlin theory, a capital abundant country specializes in capital intensive goods. Thus it produces capital intensive goods and exports them, and imports labor-intensive good.

But this does not prove right in the case of the US. Being a capital intensive country it imports capital intensive goods and exports labor-intensive goods.

This was proved by W. Leontief through empirical evidence. Thus, it is called the Leontief paradox.

User Brad Ruderman
by
7.9k points
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.