Using 1947 US input–output tables and data on exports and imports, Leontief (1953) found, to the surprise of the profession, that the capital per worker of US exports was less than the capital per worker of US import substitutes. The response to this empirical ‘paradox’ was the formulation of theory that might explain why a capital abundant country had labour-intensive exports. These were the first (confused) steps in an ongoing process of making the theory and data conform sufficiently to enable us comfortably to claim to understand the basis for international trade.
KeywordsFactor content of trade Factor mobility Heckscher–Ohlin–Samuelson trade model Leontief paradox
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