Capital Utilization in the Heckscher-Ohlin Model
Roger R. Betancourt, Christopher Clague, and Arvind Panagariya ,
( 2 )
International Trade Journal

International variations in capital utilization as a result of operations are a significant but neglected characteristic of the world economy. In this paper we introduce endogenous capital utilization into the Heckscher-Ohlin model and we show that: if workers differ internationally in their willingness to work the abnormal hours associated with higher levels of capital utilization, the factor-price equalization theorem will no longer be valid, nor will technology and endowments be the sole determinants of comparative advantage.

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