Which theory explains that a nation holds a comparative advantage in producing a good if it has a relative abundance of the production factors that are used intensively in making that good?
Explanation
The Heckscher-Ohlin theorem asserts that a country will have a comparative advantage in producing goods that require factors of production that are relatively abundant in that country. This contrasts with other theories such as the Ricardo-Malthus principle or the Lucas-Laffer hypothesis, which focus on different economic concepts.