Factor endowments and trade of the United States and Taiwan: The Leontief paradox re-examined

The primary purpose of this paper is to re-examine the compatibility of the factor endowment theorem with the foreign trade of both the United States and Taiwan. The study presents evidence that the so-called Leontief paradox may be attributable to technological gaps and factor intensity reversals between the two trading countries. In addition, the conditions for existence of the paradox are generalized. A distinctive feature of this study is that the technologies of both countries are taken into account. The findings reveal that if one-sided technical coefficients, of either the United States or Taiwan, are used for the empirical tests, the Leontief paradox tends to result. The paradox is likely to disappear when the Leontief index is derived from the technical coefficients of both trading countries.     

Depreciation and interest deductions and the effect of the corporation income tax on investment: A comment

When all jobs are full time and workers cannot substitute alternative jobs, the skills of workers are observable. Nevertheless, the optimum may involve a benefit for those who choose not to work (making their skills unobservable). When the tax structure and benefit for nonworkers are chosen to maximize welfare, they tradeoff the social marginal utility of consumption against the needed incentive to work. In contrast to more conventional models, the optimal tax schedule may have discontinuities and may involve subsidization of the work of low earners.     

Explicit representation of the two-dimensional section of a production possibility set

Technical and scale efficiencies of Data Envelope Analysis are associated with a two dimensionalsection (a convex set) representing the amounts by which the input and output vectors of a reference decision making unit, may be scaled and still lie in the production possibility set. We describe a simple algorithm, closely resembling the simplex algorithm of linear programming, to traverse the boundary of this set. Given the output of our algorithm, the scalar efficiency measures and return-to-scale characterization are trivially determined. Moreover, the set may be graphically displayed for any problem in any number of dimensions with only a minimum of additional computing effort.