Labor Markets and International Trade: Testing the Heckscher-Ohlin Trade Theory with a Natural Experiment

Publication Date


Grant Type

Early Career Research Award


Following the outbreak of the Second Intifada in 2000, the commuting of Palestinians from the West Bank into Israel, which was previously practiced by over 25% of the West Bank labor force, was greatly reduced. This change effectively increased the local labor supply in the West Bank by about 20% in an extremely short time. Trade in goods from and into the West Bank, however, was not interrupted. The goal of this project is to study the changes to production, wages, and trade patterns, that resulted from this change, in order to test the predictions of the Heckscher-Ohlin theory.

Grant Product

Testing the Heckscher-Ohlin_Vanek Theory with a Natural Experiment
Kalamazoo, MI: Upjohn Institute working paper 15-243, 2015

Research Seminar in International Economics, Gerald R. Ford School of Public Policy, The University of Michigan, Discussion Paper No. 642, under same title

Testing the Heckscher-Ohlin-Vanek theory with a natural experiment. Canadian Journal of Economics 2019 52(1): 58-92.