What is Availability Theory ? | International Economics | Ecoholics

Let's learn about the Availability Theory .According Kravis ,a country
produced and exported those goods which it had ‘available’, that is,
goods developed by its entrepreneurs and innovators. Thus, Kravis
propounded the theory that the commodity composition of trade is
determined primarily by ‘availability’. Availability means an elastic supply. Trade takes place in only those goods which are ‘not available at home.’ By this phrase he means
(a) a country will import those goods which are not available in the absolute sense, for
example, diamonds;
(b) export those goods which are available in
quantities greater than domestic demand.
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