= Factor price equalization
{wiki=Factor_price_equalization}
Factor price equalization is an economic theory that is part of the Heckscher-Ohlin model of international trade. It suggests that if countries engage in free trade, the prices of factors of production (such as labor and capital) will tend to equalize across countries, under certain conditions. This occurs as countries specialize in the production of goods that utilize their abundant factors of production more intensively.
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