Factor endowments refer to the resources and inputs that a country possesses, which can include land, labor, capital, and natural resources. These endowments influence a nation's economic activities and its ability to produce goods and services. For example, a country rich in natural resources like oil may focus on energy production, while one with a skilled workforce may excel in technology and innovation. The concept of factor endowments is central to international trade theory, particularly in the Heckscher-Ohlin model. This model suggests that countries will export goods that utilize their abundant factors and import goods that require factors they lack. Thus, factor endowments shape a country's comparative advantage in the global market.