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Trade Effects Based on Trade Equilibrium

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Submitted:

14 November 2018

Posted:

16 November 2018

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Abstract
The Rybczynski theorem describes the relationship between commodities and factor supplies, holding output price. By releasing holding commodity price, this paper introduces the trade effects of changes of factor endowments both on factor price and on commodity price. This is a study based on trade equilibrium. Technically, the study shows that change of factor endowments lead to a chain effect that Rybczynski’s trade effect triggers the Stolper-Samuelson’s trade effect. The analysis of this paper shows that economic activities, such as the change of factor endowments of any factor of any country reward another factor domestically and internationally. This is a tuneful circle. Trade brings a well-balanced development to the world.
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Subject: Business, Economics and Management  -   Economics
Copyright: This open access article is published under a Creative Commons CC BY 4.0 license, which permit the free download, distribution, and reuse, provided that the author and preprint are cited in any reuse.
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