Can the framework and analytical methods of traditional international trade theory be referred to?

Can be referred to, have a certain inspirational effect, but can not be completely without modification and direct appropriation. The traditional trade theory focuses on trade in goods; in the past 20 years, trade in services and trade in investment have both developed rapidly. The traditional theoretical framework and analytical methods still have some reference value, but they are less relevant and less rational.

What are the traditional theories of international trade?

The traditional international trade theories are: absolute advantage theory, H-O-S model, relative advantage theory or comparative advantage theory.

1, Ricardo's doctrine of comparative advantage, that is, each country is engaged in separate specialization in production conducive to improving the conditions of exchange of goods through international exchange, in order to improve the income and welfare of each country. The doctrine of comparative advantage mainly emphasizes the fact that countries have different functional characteristics in terms of demand and supply. The division of labour between countries, i.e. specialization, allows for the development of different technologies. Thus, even with the same labor force, the production function of each country is not the same, thus differentiating the economy from country to country, each in its own way.

2. The main conclusion of the H-O-S theory is that a given country mainly exports products produced by the kind of factors of production that are relatively abundant and cheap in its own country and imports products produced by the kind of factors of production that are relatively scarce in its own country.

3, Heckscher-Ohlin theory (H-O-S, Eli Heckscher-Bertil Ohin-Paul Semuelson) model is a two-country, two-commodity, two-resource endowment model. Its main premise assumptions are the following:

1) The factors of production are homogeneous, or the technical level of production is the same, and therefore the production function of the product is the same. 2) The returns to scale of production are unchanged. 3) It is in line with the premise assumptions of the model of a perfectly competitive market. 4) The factors of production are fully utilized. 5) The factors of production in each country are different, and therefore the goods are differently factor-intensive. That is, labor-intensive vs. capital-intensive in general.

However, the American economist Lyon Tickford found as early as 1953, on the basis of U.S. statistics for 1947, that the capital/labor ratio of U.S. imports > the capital/labor ratio of exports. That is to say, the United States as a capital-rich developed countries export labor-intensive products, imports of capital-intensive products, which is inconsistent with the theoretical prediction of the H-O-S, known as the "Lyon Tickford mystery". Lyon Tickford's discovery completely overturned the empirical basis of the traditional theory of international trade

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