Using panel data, we provide an integrated treatment of factor endowments, factor prices, and international specialization. In the various cross sections, we confirm the Heckscher-Ohlin prediction that, with sufficient differences in country endowments, there is no factor Price equalization and...

Why do we observe a U-shaped industrial concentration curve over an economy's development path? We show that at least one third of this phenomenon is explained by the effect of capital accumulation on industrial specialization.