International Economics
Factor endowments refer to the quantities and qualities of factors of production, such as labor, land, and capital, that a country possesses. These endowments play a crucial role in determining a nation’s comparative advantage in producing certain goods and services, influencing its trade patterns and economic specialization. Understanding factor endowments helps explain why countries export certain products while importing others, and connects directly to the Heckscher-Ohlin model, which posits that countries will export goods that utilize their abundant factors of production intensively.
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