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AA00260492-19930002-0057.pdf
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Title |
Title |
THE MAGNIFICATION EFFECT WITH THREE FACTORS
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THOMPSON, Henry
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Auburn University
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Keio Economic Society, Keio University
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1993
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Keio economic studies
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30
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2
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1993
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57
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64
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Abstract |
Price changes create a range of factor price adjustments in the three factor, two good general equilibrium model of production. Comparative static adjustments in the model have been described by magnification effects and sign patterns. This note supplements the diagrammatic technique of Jones and Easton (1983, Journal of International Economics) and derives eleven magnification effects implied by the sign patterns of Thompson (1985, Canadian Journal of Economics). At the bottom line, only one type of magnification effect can be ruled out. Stated in terms of the extreme or most intensive factors, the Stolper-Samuelson theorem cannot be reversed.
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