Problem
Consider two identical, 2 good, 2-factor economies with IRS in both goods. Through trade, H exports X and F exports Y.
1. Describe and show the circumstances under which H can be worse off from trade relative to autarky.
2. Describe and show the circumstances under which F can be worse off from trade relative to autarky.
3. Are factor prices equal across the two countries in the above cases? Explain why or why not?