Multiple choice

'International Trade Theory' was the contribution of

  1. Bertic Ohlin

  2. Arthur Okun

  3. Adam Smith

  4. None of the above
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A Correct answer
Explanation

Bertil Ohlin (note spelling correction from 'Bertic') developed the Heckscher-Ohlin model of international trade, which explains trade patterns based on factor endowments. The model shows that countries export goods that use their abundant factors of production and import goods that use their scarce factors. This fundamental theory (with Eli Heckscher) earned Ohlin the Nobel Prize in Economics in 1977. Adam Smith proposed absolute advantage theory, while Arthur Okun is known for Okun's Law in macroeconomics.

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