Revisiting Leontief's paradox. Issue 6 (1st November 2016)

• Record Type: Journal Article
• Authors: Paraskevopoulou, Christina; Tsaliki, Persefoni; Tsoulfidis, Lefteris
• Is Part Of: International review of applied economics. Volume 30:Issue 6(2016)
• Page Start: 693
• Page End: 713
• Publication Date: 2016-11-01
• Subjects: Leontief's paradox -- international trade -- US economy -- factor content; F10 -- F11 -- F16 -- J3; Economics -- Periodicals; Web sites; Économie politique -- Périodiques; 330
• DOI: 10.1080/02692171.2016.1173655
• Languages: English
• ISSNs: 0269-2171

Abstract

Abstract: According to the popular Heckscher-Ohlin model of international trade, a country is expected to export (import) those products whose production requires the intensive use of the factor of production that is in relative abundance (scarcity). Leontief (1953), using input–output data of the US economy for the year 1947, found that the US, an overwhelmingly capital-abundant country, exported labour-intensive products and imported capital-intensive ones. Clearly, the results contradicted the predictions of the Heckscher-Ohlin model and they were characterised as 'Leontief's paradox'. A number of explanations for the so-called paradox were offered and this paper briefly, but critically, evaluates these explanations as it examines whether or not Leontief's results persist in the case of the US economy during the period 1998–2012.