Testing two trade models in Latin American agriculture

Abstract

AbstractThe Heckscher–Ohlin and Markusen models state that countries export the goods intensive in the use of their relatively abundant factor. Latin American agricultural trade is consistent with both models. The paper then shows that Latin American agricultural trade is primarily explained by country differences in relative factor abundance between countries rather than differences in technology. This finding does not reject the Heckscher–Ohlin model but rejects one of Markusen's models.