Eli Filip Heckscher (24 November 1879 – 23 December 1952) was a Swedish

political economist Politics () is the set of activities that are associated with making decisions in groups, or other forms of power relations among individuals, such as the distribution of status or resources. The branch of social science that studies poli ...

and

economic historian Economic history is the study of history using methodological tools from economics or with a special attention to economic phenomena. Research is conducted using a combination of historical methods, statistical methods and the application of ...

who was a professor at the

Stockholm School of Economics The Stockholm School of Economics (SSE; , HHS) is a private business school located in city district Vasastaden in the central part of Stockholm, Sweden. SSE offers BSc, MSc and MBA programs, along with PhD- and Executive education progr ...

. He is known for the

Heckscher–Ohlin theorem The Heckscher–Ohlin theorem is one of the four critical theorems of the Heckscher–Ohlin model, developed by Swedish economist Eli Heckscher and Bertil Ohlin (his student). In the two-factor case, it states: "A capital-abundant country will exp ...

, an influential model of

international trade International trade is the exchange of capital, goods, and services across international borders or territories because there is a need or want of goods or services. (See: World economy.) In most countries, such trade represents a significan ...

that predicts that capital-abundant countries export capital-intensive goods, while labor-abundant countries export the labor-intensive goods.

Biography

Heckscher was born in Stockholm, son of the Jewish Danish-born businessman Isidor Heckscher and his spouse Rosa Meyer, and completed his secondary education there in 1896. He conducted higher studies at

Uppsala University Uppsala University (UU) () is a public university, public research university in Uppsala, Sweden. Founded in 1477, it is the List of universities in Sweden, oldest university in Sweden and the Nordic countries still in operation. Initially fou ...

(from 1897) and Gothenburg University College (in 1898), completing his PhD in Uppsala in 1907. He was professor of Political economy and Statistics at the

from 1909 until 1919, when he exchanged that chair for a research professorship in

economic history Economic history is the study of history using methodological tools from economics or with a special attention to economic phenomena. Research is conducted using a combination of historical methods, statistical methods and the Applied economics ...

, finally retiring as emeritus professor in 1945. In 1929 Heckscher founded the Institute for Economic and Business History Research as a key step in his effort to create the field of economic history in Sweden, and make it a policy-oriented science. He advanced his agenda by recruiting two other scholars, historian Bertil Boëthius (1885–1974) and economist Arthur Montgomery. Thereby the "Stockholm School" emerged and achieved a voice in government planning. Prior to World War I, Heckscher was a social conservative who advocated for an interventionist state. During World War I, his attitudes shifted, as he became a proponent of economic liberalism and a staunch opponent of state interventionism. Heckscher is well known for his 1935 book ''Mercantilism'', which was translated into several languages. He is also known for multi-volume ''An Economic History of Sweden''.Donald Cuthbert Coleman, "Eli Heckscher and the idea of mercantilism." ''Scandinavian Economic History Review'' 5.1 (1957): 3–25. Heckscher's most important work, though, is his

1919 Events January * January 1 ** The Czechoslovak Legions occupy much of the self-proclaimed "free city" of Pressburg (later Bratislava), enforcing its incorporation into the new republic of Czechoslovakia. ** HMY ''Iolaire'' sinks off th ...

article “The Effect of Foreign Trade on the Distribution of Income." In this article, Heckscher provided a model explaining patterns in

now known as the ( Heckscher–Ohlin model). Heckscher's "The Effect of Foreign Trade on the Distribution of Income" was groundbreaking but originally gained little attention for several reasons. First, Hecksher published the article in the Swedish journal ''Ekonomisk Tidskrift'' in Swedish, a language with comparatively less international access. Second, even those reading Swedish and following Hecksher may have overlooked this particular article at first since Heckscher was so prolific (he published 1148 articles and books). Finally, Heckscher was a

Jew Jews (, , ), or the Jewish people, are an ethnoreligious group and nation, originating from the Israelites of ancient Israel and Judah. They also traditionally adhere to Judaism. Jewish ethnicity, religion, and community are highly inte ...

which was a factor because, just as the significance of the article became apparent beyond Sweden, the rise of

anti-Semitism Antisemitism or Jew-hatred is hostility to, prejudice towards, or discrimination against Jews. A person who harbours it is called an antisemite. Whether antisemitism is considered a form of racism depends on the school of thought. Antisemi ...

globally and

Nazi Nazism (), formally named National Socialism (NS; , ), is the far-right politics, far-right Totalitarianism, totalitarian socio-political ideology and practices associated with Adolf Hitler and the Nazi Party (NSDAP) in Germany. During H ...

sm bans on Jewish authors arguably delayed its greater recognition until after

World War II World War II or the Second World War (1 September 1939 – 2 September 1945) was a World war, global conflict between two coalitions: the Allies of World War II, Allies and the Axis powers. World War II by country, Nearly all of the wo ...

. Heckscher's famous former student Bertil Ohlin at the

(who himself succeeded Heckscher as professor there), significantly expanded on Hecksher's theory, giving it more support and a wider audience. Ohlin won the

Nobel Memorial Prize in Economic Sciences The Nobel Memorial Prize in Economic Sciences, officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel (), commonly referred to as the Nobel Prize in Economics(), is an award in the field of economic sciences adminis ...

in 1977 long after Heckscher's death. Heckscher was a member of the

American Philosophical Society The American Philosophical Society (APS) is an American scholarly organization and learned society founded in 1743 in Philadelphia that promotes knowledge in the humanities and natural sciences through research, professional meetings, publicat ...

Heckscher–Ohlin theorem

The Heckscher–Ohlin Theorem, which is concluded from the Heckscher–Ohlin model of international trade, states: trade between countries is in proportion to their relative amounts of capital and labor. In countries with an abundance of capital, wage rates tend to be high; therefore, labor-intensive products, e.g. textiles, simple electronics, etc., are more costly to produce internally. In contrast, capital-intensive products, e.g. automobiles, chemicals, etc., are less costly to produce internally. Countries with large amounts of capital will export capital-intensive products and import labor-intensive products with the proceeds. Countries with high amounts of labor will do the reverse. The following conditions must be true: * The major factors of production, namely labor and capital, are not available in the same proportion in both countries. * The two goods produced either require more capital or more labor. * Labor and capital do not move between the two countries. * There are no costs associated with transporting the goods between countries. * The citizens of the two trading countries have the same needs. The theory does not depend on total amounts of capital or labor, but on the amounts per worker. This allows small countries to trade with large countries by specializing in production of products that use the factors which are more available than its trading partner. The key assumption is that capital and labor are not available in the same proportions in the two countries. That leads to specialization, which in turn benefits the country's economic welfare. The greater the difference between the two countries, the greater the gain from specialization.

Personal life

Eli Heckscher's son was Gunnar Heckscher (1909–1987), a political scientist and the leader of what would later become the Swedish Moderate Party 1961–1965. His grandson is the

Social Democratic Social democracy is a Social philosophy, social, Economic ideology, economic, and political philosophy within socialism that supports Democracy, political and economic democracy and a gradualist, reformist, and democratic approach toward achi ...

politician Sten Heckscher.

References

Sources

* Bertil Ohlin, "Heckscher, Eli Filip", '' Svenskt biografiskt lexikon'', vol. 18, pp. 376–381.

External links

* {{DEFAULTSORT:Heckscher, Eli 1879 births 1952 deaths Writers from Stockholm Swedish economists 20th-century Swedish historians Swedish Jews Jewish historians Economic historians Trade economists Uppsala University alumni University of Gothenburg alumni Academic staff of the Stockholm School of Economics Member of the Mont Pelerin Society Members of the American Philosophical Society