Stolper-Samuelson Theorem

Definition:

The Stolper-Samuelson theorem is as follows: In some models of international trade, trade lowers the real wage of the scarce factor of production, and protection from trade raises it. That is a Stolper-Samuelson effect, by analogy to their (1941) theorem in a Heckscher-Ohlin model context.

A notable case is when trade between a modernized economy and a developing one would lower the wages of the unskilled in the modernized economy because the developing country has so many of the unskilled.

(Econterms)

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Econterms. "Stolper-Samuelson Theorem." ThoughtCo, Jun. 10, 2014, thoughtco.com/the-stolper-samuelson-theorem-1147211. Econterms. (2014, June 10). Stolper-Samuelson Theorem. Retrieved from https://www.thoughtco.com/the-stolper-samuelson-theorem-1147211 Econterms. "Stolper-Samuelson Theorem." ThoughtCo. https://www.thoughtco.com/the-stolper-samuelson-theorem-1147211 (accessed February 20, 2018).