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Factor space |
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Factor spaceA graph in which the axes measure quantities of factors.Similar MatchesScarce factorScarce factorThe factor in a country's endowment with which it is least well endowed, relative to other factors, compared to other countries. May be defined by quantity or by price. Factor Price Equalization TheoremFactor Price Equalization TheoremOne of the major theoretical results of the Heckscher-Ohlin Model with at least as many goods as factors, showing that free and frictionless trade will cause FPE between two countries if they have identical, linearly homogeneous technologies and their factor endowments are sufficiently similar to be in the same diversification cone. Risk factorRisk factorIn arbitrage pricing theory or the multibeta capital asset pricing model, the set of common factors that impact returns, e.g., market return, interest rates, inflation, or industrial production. Factor price frontierFactor price frontierA curve in factor space showing the minimum combinations of factor prices consistent with absence of profit in producing one or more goods, given their prices. Since, with perfect competition, profit implies disequilibrium, this shows a lower bound on equilibrium factor prices. Factor abundanceFactor abundanceThe abundance or scarcity of a primary factor of production. Because, in the short run at least, the supplies of primary factors are more or less fixed, this can be taken as given for determining much about a country's trade and other economic variables. Fundamental to the H-O Model. Further SuggestionsAmortization factorSpecific factor Factor endowment Factor-price space Factor price Factor scarcity Factor analysis Tariff factory Single factor model Factor share Abundant factor Conversion factors Currency factor Factor portfolio Annuity factor Multifactor model Reported factor Pool factor Footloose factor Direct-plus-indirect factor content Factor of production price earnings growth factor Factor content pattern of trade earnings factor Specific factors model |
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