A note on the empirical implementation of lens condition:
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Bibliographic Details
Main Authors: Bernard, Andrew B. 1963- (Author), Robertson, Raymond 1969- (Author), Schott, Peter K. (Author)
Format: Book
Language:English
Published: Cambridge, Mass. National Bureau of Economic Research 2005
Series:National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series 11448
Subjects:
Links:http://papers.nber.org/papers/w11448.pdf
Abstract:"Deardorff [Journal of International Economics 36 (1994) 167-175] offers an intuitively appealing test for factor price equality (FPE). He demonstrates that FPE is impossible if the set (i.e., lens) of points defined by regional factor abundance vectors does not lie within the set of points defined by goods' input intensities. This note demonstrates that empirical implementation of the lens condition is problematic if the "true" number of either goods or regions is unknown. We show that satisfaction of the lens condition is more likely when goods are relatively disaggregate compared to regions"--National Bureau of Economic Research web site.
Physical Description:16 S. graph. Darst.