: SAGE: Stolper-Samuelson theorem

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Stolper-Samuelson theorem

As presented in the original 1941 article by Walter Stolper and Paul Samuelson, the theorem postulates that the imposition of an import tariff by a small nation leads to an increase in the real income of the scarce production factor of that nation and to a reduction in the real income of the abundant factor. Factor abundance depends thereby on the relative endowments of the production factors (e.g., capital to labor ratio) in one country compared to the other. [Source: The Encyclopedia of Political Science; Stolper-Samuelson Theorem]

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