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The 1987 study by Bowen, Leamer and Sveikauskas: a) Supported the validity of the Leontief Paradox, b) Supported the validity of the Heckscher-Ohlin model, c) Used a two-country and two-product framework, d) Demonstrated that in fact countries tend to use different technologies, e) Proved that the U

Business Dec 27, 2020

The 1987 study by Bowen, Leamer and Sveikauskas:

a) Supported the validity of the Leontief Paradox,

b) Supported the validity of the Heckscher-Ohlin model,

c) Used a two-country and two-product framework,

d) Demonstrated that in fact countries tend to use different technologies,

e) Proved that the U.S.'s comparative advantage relied on skilled labor.

Expert Solution

The answer is asupported the validity of the Leontief Paradox.

The Leontief Paradox in economics has its main focus on two factors which are; capital and labor. Leontief ignored the other factors of production which include entrepreneurship and land. According to the study by Bowen, Leamer, and Sveikauskas, they supported the fact that in his paradox, Leontief tried to explain how the US focus on importing commodities that were capital intensive and dealt in the export of commodities that were labor-intensive. According to Leontief, a country with high capital per worker would definitely experience low capital in its exports than it would in imports.

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