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Jointness In Production and Factor‐Price Equalization *
Author(s) -
Jones Ronald W.
Publication year - 1992
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/j.1467-9396.1992.tb00003.x
Subject(s) - economics , commodity , production (economics) , equalization (audio) , joint (building) , yield (engineering) , factor (programming language) , factor price , econometrics , microeconomics , computer science , channel (broadcasting) , telecommunications , market economy , architectural engineering , programming language , materials science , engineering , metallurgy
This paper argues that the presence of activities which yield outputs jointly does not damage the case for factor‐price equalization. the crucial condition for equalization is similar to that in the no‐joint production case: the number of common activities with independent input vectors that are actively used in both countries at least match the number of factors, and factor endowments lie sufficiently close. Indeed, joint production may increase the range of commodity prices for which factor prices are equalized by commodity trade.