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ERIC Number: EJ796074
Record Type: Journal
Publication Date: 2008
Pages: 8
Abstractor: Author
ISBN: N/A
ISSN: ISSN-0022-0485
EISSN: N/A
A Geometric Comparison of the Transformation Loci with Specific and Mobile Capital
Colander, David; Gilbert, John; Oladi, Reza
Journal of Economic Education, v39 n2 p145-152 Spr 2008
The authors show how the transformation loci in the specific factors model (capital specificity) and the Heckscher-Ohlin-Samuelson model (capital mobility) can be rigorously derived and easily compared by using geometric techniques on the basis of Savosnick geometry. The approach shows directly that the transformation locus with capital specificity has a greater degree of curvature than with capital mobility, given the same technology, and that the latter is an envelope of the former. It can also be used to show how incentives in the short run would lead to the long-run capital reallocation implied by the assumption of capital mobility. (Contains 3 figures.)
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Publication Type: Journal Articles; Reports - Evaluative
Education Level: Higher Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A
Grant or Contract Numbers: N/A