The Young Ohlin on the Theory of "Interregional and International Trade"

Bertil Ohlin’s international fame as an economist rests to a large extent on his 1933 monograph "Interregional and International Trade" (Ohlin, 1933). The monograph marked the definitive break with the Ricardian and early neoclassical theory of international trade. Eli Heckscher’s contribution of 1919 did not become known to a wider audience until his article was published in English in 1949 (Heckscher, 1949, 1991). But Interregional and International Trade was not Ohlin’s first formulation of the neoclassical theory of international trade; it was his third. His first attempt is his licentiate dissertation of 1922 and the second his doctoral dissertation published in 1924. The latter was published in English in 1991 under the title "The Theory of Trade" (Heckscher and Ohlin, 1991). The licentiate dissertation, entitled "The Theory of Interregional Exchange" has remained untranslated until very recently (Ohlin, 1999).We will trace the development of Ohlin’s thinking on international trade by comparing the three works. Special emphasis will be placed on "The Theory of Interregional Exchange" since it is the first and practically unknown. We have discussed and compared "The Theory of Trade and Interregional and International Trade" elsewhere (Flam and Flanders, 1991).