In this paper, we build a formal, rigorous economic model for foreign language learning, taking language input and language output as two crucial factors working jointly to generate language competence. The central idea behind our model is that the learner, constrained by limited resources, is confronted with a tradeoff between input-oriented training and output-oriented training. First, one major contribution of our modeling lies in its effort to reconcile the Input Hypothesis with the Output Hypothesis in the literature by showing that one important aspect of the learner’s learning strategy, i.e. the input-output mix, is crucially dependent on the learning environment. Second, our modeling provides guidelines for data based empirical research, where the partial effects of the variables of interest can be estimated and hypotheses on the directions and magnitudes of the effects can be tested, econometrically. Third, our modeling also provides insights that can assist language instructors in making and fine-tuning teaching strategies.