The Validity of the Long-run Heckscher-Ohlin Theorem in the Ricardian System

Applying Burgstaller's Ricardian two-sector growth model to the two-country open economy, this paper shows that the long-run Heckscher-Ohlin theorem holds also in a Ricardian world. In addition it is shown that, if two Ricardian countries that are different only in their demand parameters open trade, comparative advantage and the corresponding trade pattern at trade opening continue in the long run after the opening of trade. Copyright (c) The London School of Economics and Political Science 2005.