Modern Theory of Comparative Advantage (With Criticisms)
In this article we will discuss about the modern theory of comparative advantage. Also learn about its criticisms. In order to improve Ricardo's theory, two Swedish economists, Ela Heckscher (l919) and Ohlin (1933) developed a theory which stressed factor endowment as the basis of international trade. The Heckscher-Ohlin approach to international trade accepts that international trade is based on differences [...]