[经济学]INTERNATIONAL ECONOMICS4.ppt

（四）Resources, Comparative Advantage, and Income Distribution 1.A Model of Two-Factor Economy 2.Effects of International Trade Between Two-Factor Economies Case Study: North South Trade and Income Inequality 3.The Political Economy of Trade: A Preliminary View 4.Empirical Evidence on the Heckscher-Ohlin Model 5. Summary 1.A Model of a Two-Factor Economy (1).Prices and Production (2).Choosing the Mix of Inputs (2).Factor Prices and Goods Prices (3).Resources and Output (1). Prices and Production The economy we studied produce two goods: cloth and food two inputs: labor and land labor and land are in limited supply then, define: aTC, aLC, aTF, aLF, L, T We assume: Figure 4-1 The Production Possibility Frontier Without Factor Substitution Figure 4-2 The Production Possibility Frontier With Factor Substitution In general, the economy should produce at the point that maximizes the value of production, V: V = PCQC + PFQF Define an isovalue line as a line representing a constant value of production. V = PCQC + PFQF PFQF = V – PCQC QF = V/PF – (PC /PF)QC The slope of an isovalue line is – (PC /PF) Figure 4-3 Prices and Production (2).Choosing the Mix of Inputs Figure 4-4 Input Possibilities in Food Production Figure 4-5 Factor Prices and Input Choices (3).Factor Prices and Goods Prices Under competition, the price of a good equals the cost of production, and the cost of production depends on the wage rate and the rental rate. The effect of the rental rate of land on the price of cloth depends on the intensity of land usage in cloth production. An increase in the rental rate of land will affect the price of food more than the price of cloth. Under competition, changes in w/r are therefore directly related to changes in PC /PW . (3).Factor Prices and Goods Prices We have a relationship among factor prices and good prices and the levels of factors used in production: Stolper-Samuelson theorem: if the relative price of a good increases, then the real wa