Which of the following is a feature of the 'Specific Factors Model' of international trade?
A. Some factors are specific to particular industries while labour is mobile between industries
B. All factors are mobile between industries
C. Only capital is mobile internationally
D. There are no specific factors
Answer: Option A
Solution (By JKSSB Mock Tests)
In the specific-factors (Ricardo-Viner) model, each industry has a factor that is specific to it (immobile) while at least one factor (usually labour) is mobile between industries, generating clear distributional predictions of trade.
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