U. S. exports are less capital-intensive than U. S. imports, despite the relative abundance of capital in the country. What is this phenomenon that runs contrary to the prediction of the Heckscher-Ohlin theory called?

A. A zero-sum game

B. The Leontief paradox

C. A positive-sum game

D. Samuelson's critique

E. A first-mover advantage

Question

Darren Roman

Business

7 January, 06:54

U. S. exports are less capital-intensive than U. S. imports, despite the relative abundance of capital in the country. What is this phenomenon that runs contrary to the prediction of the Heckscher-Ohlin theory called?

A. A zero-sum game

B. The Leontief paradox

C. A positive-sum game

D. Samuelson's critique

E. A first-mover advantage

+5

Answers (1)

Know the Answer?

Dominique Torres · Answer 1

The correct answer is letter "B": The Leontief paradox.

Explanation:

The Leontief paradox is the result of a research made by German economist Wassily Leontief (1906-1999) in the 1950s after which he observed that countries with large capital such as the U. S. were importing more capital-intensive products and exporting more labor-intensive goods.

The Leontief paradox opposed the Heckscher-Ohlin Theorem that stated large capital countries tend to export products they manufacture efficiently and import those they are not good at producing.