In international trade theory, the 'Heckscher-Ohlin Model' explains comparative advantage primarily based on differences in:

💡 Solution & Explanation

The Heckscher-Ohlin model explains international trade patterns through differences in national factor endowments, such as relative abundance in labor or capital. Countries tend to export goods that intensively utilize their abundant production factors while importing goods requiring scarce factors. This contrasts with classical trade theories that rely exclusively on labor productivity differences or technological variations between nations.