The analyzes the income distribution effects of trade in the short run when resources are immobile among industries ?
Correct answer: C. specific factors theory
- A. Stolpher-Samuelson theory
- B. factor endowment theory
- C. specific factors theory
- D. overlapping demand theory
Explanation
The specific-factors theory studies short-run trade effects when some resources cannot move between industries. Factors specific to an export industry may gain, while factors tied to import-competing industries may lose.
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