If the Heckscher-Ohlin model is correct, there would never be ...

[erika]

If the Heckscher-Ohlin model is correct, there would never be intraindustry trade.
 
  Indicate whether the statement is true or false

Question 2

What economic problems persist in Latin America? How has this shaped recent policy in the region and why are changes particularly challenging?
 
  What will be an ideal response?

[otokexnaru]

Answer to Question 1

FALSE
Explanation: Several explanations of intraindustry trade are consistent with a Heckscher-Ohlin world, including transportation costs and data problems.

Answer to Question 2

The lack of material improvement for large numbers of the population has forced policy makers to try to find ways to develop a more inclusive economic system by creating opportunities for excluded groups. They are also trying to make the countries less prone to macroeconomic crises and to create greater flexibility by addressing some of the legal and institutional rigidities that may be affecting outcomes. A long history of exclusion has blocked economic opportunity for particular groups. It is politically difficult to address inequality because inevitably it involves increasing tax collections and redirecting expenditures toward groups and regions that tend to be among the least powerful and least influential. Policies that will help include increasing spending on rural infrastructure to connect isolated groups with the national economy, along with spending on education, health care and microcredit programs.