Krugman on Marx

Brad De Long delong at econ.Berkeley.EDU
Thu Aug 13 10:27:21 PDT 1998


Re:
>
>Nobody, absolutely nobody, could refute any neo-classical theory to the
>satisfaction of the neo-classical economists.
>--
>Michael Perelman

Bertil Ohlin's theory (as applied to the United States over the past twenty-five years) that changes in patterns of international trade are the principal cause of shifts in the distribution of income is a perfectly good neoclassical theory that has been refuted to the satisfaction of most (if not all) neo-classical economists.

In fact, the entire neoclassical Heckscher-Ohlin approach to international trade--that trade is the result of differences in relative factor endowments--is in very big trouble and has been in very big trouble for two decades (in large part because of Paul Krugman).

Brad DeLong



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