The Dynamic Heckscher-Ohlin Model: A diagrammatic analysis

Author Name Eric BOND  (Vanderbilt University) /IWASA Kazumichi  (Kyoto University) /NISHIMURA Kazuo  (Faculty Fellow, RIETI)
Creation Date/NO. February 2012 12-E-008
Research Project Fundamental Research for the Construction of a Vibrant Economy and Society in Japan
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In this paper, we show that the main results of dynamic Heckscher-Ohlin models (with non-homothetic preferences) can be derived from diagrams which represent the basic functions in static models such as the Rybczynski line, income expansion paths, and excess demand functions at steady states. Results include not only the existence and the multiplicity of steady states in autarky and under free trade, but also their stabilities and the static and dynamic Heckscher-Ohlin theorems.

Published: Eric W. Bond, Kazumichi Iwasa and Kazuo Nishimura, 2012. "The dynamic Heckscher-Ohlin model: A diagrammatic analysis," International Journal of Economic Theory, Vol. 8(2), pp. 197-211.