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Heckscher-Ohlin Theory (H-O Theory) is an external trade theory developed to explain the causes of international trade based on differences in factor endowments. The theory was first proposed in 1919 by Swedish economist Eli Heckscher and later systematized by his student Bertil Ohlin in 1933. The H-O Theory extends Ricardo’s theory of comparative advantage by arguing that the fundamental determinant of trade between countries is differences in factor endowments. Unlike Ricardo’s theory, the Hec