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On the existence and characterization of unequal exchange in the free trade equilibrium

Author

Listed:
  • Naoki Yoshihara

    (Hitotsubashi University)

  • Soh Kaneko

    (Keio University)

Abstract
As in Roemer (1982, chapter 1), this paper considers a Marxian Heckscher-Ohlin model of subsistence international economies with a simple Leontief production technique and examines the existence and characterization of free trade equilibria involving the unequal exchange of labor (UEL). The paper provides an almost complete characterization of the domain of economies in which free trade equilibria with incomplete specialization exist. Moreover, the necessary and sufficient condition for a free trade equilibrium to involve UEL is identified.

Suggested Citation

  • Naoki Yoshihara & Soh Kaneko, 2015. "On the existence and characterization of unequal exchange in the free trade equilibrium," Working Papers SDES-2015-3, Kochi University of Technology, School of Economics and Management, revised Jan 2015.
    • Handle: RePEc:kch:wpaper:sdes-2015-3
    as

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    File URL: http://www.souken.kochi-tech.ac.jp/seido/wp/SDES-2015-3.pdf
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    References listed on IDEAS

    as
    1. Zhiqi Chen, 1992. "Long-Run Equilibria in a Dynamic Heckscher-Ohlin Model," Canadian Journal of Economics, Canadian Economics Association, vol. 25(4), pages 923-943, November.
    2. Roberto Veneziani & Naoki Yoshihara, 2015. "Exploitation in economies with heterogeneous preferences, skills and assets: An axiomatic approach," Journal of Theoretical Politics, , vol. 27(1), pages 8-33, January.
    3. Yoshihara, Naoki, 2010. "Class and exploitation in general convex cone economies," Journal of Economic Behavior & Organization, Elsevier, vol. 75(2), pages 281-296, August.
    4. Kazuo Nishimura & Koji Shimomura, 2012. "Trade and Indeterminacy in a Dynamic General Equilibrium Model," Springer Books, in: John Stachurski & Alain Venditti & Makoto Yano (ed.), Nonlinear Dynamics in Equilibrium Models, edition 127, chapter 0, pages 347-361, Springer.
    5. Naoki Yoshihara & Roberto Veneziani, 2009. "Exploitation as the Unequal Exchange of Labour: An Axiomatic Approach," Working Papers 655, Queen Mary University of London, School of Economics and Finance.
    6. Eric W. Bond & Kazumichi Iwasa & Kazuo Nishimura, 2012. "The dynamic Heckscher–Ohlin model: A diagrammatic analysis," International Journal of Economic Theory, The International Society for Economic Theory, vol. 8(2), pages 197-211, June.
    7. Metcalfe, J S & Steedman, Ian, 1972. "Reswitching and Primary Input Use," Economic Journal, Royal Economic Society, vol. 82(325), pages 140-157, March.
    8. Roberto Veneziani, 2013. "Exploitation, inequality and power," Journal of Theoretical Politics, , vol. 25(4), pages 526-545, October.
    9. Burmeister, Edwin, 1978. "An interest rate and factor price equalization theorem with nontraded commodities," Journal of International Economics, Elsevier, vol. 8(1), pages 1-9, February.
    10. repec:ums:papers:2014-010 is not listed on IDEAS
    11. Kazuo Nishimura & Koji Shimomura, 2006. "Indeterminacy in a dynamic two-country model," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 29(2), pages 307-324, October.
    12. Eric Bond & Kazumichi Iwasa & Kazuo Nishimura, 2011. "A dynamic two country Heckscher–Ohlin model with non-homothetic preferences," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 48(1), pages 171-204, September.
    13. Veneziani, Roberto & Yoshihara, Naoki, 2014. "One Million Miles to Go: Taking the Axiomatic Road to Defining Exploitation," Discussion Paper Series 615, Institute of Economic Research, Hitotsubashi University.
    14. Veneziani, Roberto, 2007. "Exploitation and time," Journal of Economic Theory, Elsevier, vol. 132(1), pages 189-207, January.
    15. Naoki Yoshihara & Roberto Veneziani, 2009. "Exploitation as the Unequal Exchange of Labour: An Axiomatic Approach," Working Papers 655, Queen Mary University of London, School of Economics and Finance.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Soh Kaneko & Naoki Yoshihara, 2018. "On the General Impossibility of Persistent Unequal Exchange Free Trade Equilibria in the Pre-industrial World Economy," Working Papers SDES-2018-19, Kochi University of Technology, School of Economics and Management, revised Dec 2018.
    2. Yoshihara, Naoki & Veneziani, Roberto, 2023. "The general equilibrium effects of localised technological progress: A Classical approach," Journal of Mathematical Economics, Elsevier, vol. 109(C).
    3. Cogliano, Jonathan F. & Kaneko, Soh & Veneziani, Roberto & Yoshihara, Naoki, 2020. "International Exploitation, Capital Export, and Unequal Exchange," Discussion Paper Series 718, Institute of Economic Research, Hitotsubashi University.
    4. Naoki Yoshihara, 2021. "On the labor theory of value as the basis for the analysis of economic inequality in the capitalist economy," Japanese Economy, Taylor & Francis Journals, vol. 47(2-3), pages 190-212, July.
    5. Weikai Chen & Naoki Yoshihara, 2019. "Persistent Exploitation with Intertemporal Reproducible Solution in Pre-industrial Economies," UMASS Amherst Economics Working Papers 2019-10, University of Massachusetts Amherst, Department of Economics.

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    More about this item

    Keywords

    Unequal exchange of labor; Marxian Heckscher-Ohlin international economies; international division of labor;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies

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