Write an essay on the Leontief Paradox. Include in your ...

[HudsonKB16]

Write an essay on the Leontief Paradox. Include in your discussion what Leontief found that was so paradoxical as well as a brief description of several of the various reconciliations that have been offered to explain the Paradox.
 
  What will be an ideal response?

Question 2

GDP is different than GNP in that
 
  A) it accounts for net unilateral transfers.
  B) it does not account for indirect business taxes.
  C) it does not account for a country's production using services with foreign-owned capital.
  D) it accounts for depreciation.
  E) it is unhelpful when tracking national income.

[rnehls]

Answer to Question 1

Leontief found U.S. exports were relatively labor intensive, implying within the context of the Heckscher-Ohlin model that the United States is relatively labor abundant. Several reconciliations have been offered, including U.S. labor relatively more efficient (Leontief), importance of natural resources (Vanek), U.S. tariff structure (Travis), and international differences in tastes and technologies.

Answer to Question 2

C