Project 2 will consist of an application of the theory of comparative advantage as augmented by endowment theory. In your report, consider the economic inventory of the United states and use that inventory to predict the top 5 items the United States is likely to export. This assignment asks you to prepare analysis and conclusions in your report that are an empirical test of your hypothesis.
Should the exports be land, labor, or capital intensive? Why?
What are the top 5 exports of your “chosen country?”
Are they land, labor, or capital intensive at all?
Did this information match your prediction?
Answering these questions allows you to consider goods related to land factors such as raw materials, mined or otherwise derived from land and land advantages such as the usual agricultural products associated with “land” advantages. Going 5 deep on top traded items allows you to see more of the anomalies in countries’ trade as well, and please feel free to choose other traded items from your country near the top 5 that shed some extra light on the basic question of M3A1 – how well does standard comparative advantage relative factoral endowment theory explain trade? If not so well, does the government or other artificial factors help explain the production and trade patterns?
Be sure to submit your project in one Word document in APA format, and place it in the appropriate assignment drop-box. The document should be doubled-spaced, and should be between 750-1,000 words
of core content (approximately 3-4 pages, excluding title page and references.)
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