International trade operations Essay Example | Topics and Well Written Essays - 750 words

International heap operations - Essay ExampleSince 2000 however, although the revenues from exports to EU fork over increased, its share has decreased with take note to total exports. With respect to the other industries such as cement and manufacturing, the theory is not applied. Therefore, the theory has been commensurate to sexual conquest for plow patterns with the EU-15 countries until 2000 with respect to the timber industry. The Heckscher Ohlin theorem explicates a countrys production characteristic by taking into account the various factors of labour, land and capital. A country is hypothesized to abundantly produce and export those types of goods that conform to its strengths, being exclusively capital intensive or labour intensive. Moreover, similar to the theory of comparative advantage, the country need not necessarily have a particular resource in abundance it save needs to be abundant with respect to the other resources. After taking into account, the various features of the countrys economy and resources, the source applies the theory to the timber industry. Latvias high land ratio relative the population is used to justify the high percentage of timber exports as being a land intensive product. Therefore, it seems to be instead satisfactory. However, when the case of countries such as Sweden and Finland is considered, the theory fails since they have lower population densities than Latvia. Once again, this theory is also not applied to other industries. In addition, both the theories deal with comparative advantage but do not have an account of changing comparative advantage of a nation or the emerging direction of the economy of a nation with respect to its strengths. 2) While both of the theories are able to explain some of the patterns of distribute in a certain time period applied to a case-by-case industry, it might be argued that any theory of international trade will be able to do this (Zhang, 2008, p.71). The requireme nt of a theory is that it must be able to account for a majority of the factors that knead an economy. Its success is therefore determined by its proximity and applicability to practical situations that are very mazy rather than explaining simple models. Hence, the theories can be considered as guiding principles upon which more complex theories of international trade are built upon. At the same time, it is not possible for a theory to account for all of the changes over a long period of time and must be constantly updated. The theories have provided a starting point for development of more inclusive models. An important trait of a theory is that it is able to simplify the various factors that it deals with. For this purpose and for academic analysis, complex practical situations are often isolated and canvas independently of the other. However, the application of the traditional theories of comparative advantage and that of the Hecksher Ohlin model has proved that they have been successful only in certain conditions. As economies around the world and the factors influencing them have become numerous and more complex, a need for a more effective theory(s) that incorporates many of these factors has grown. Therefore, the writer has been ambitious in concluding that the theories have been able to corroborate findings with respect to the Latvian economy and its trade partners. However, the article provides a considerable join of information that is useful to the Latvian