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New Trade Theories: Scale and Competition by mani12_mit163 is a document available to read on EtoBox.
What is New Trade Theories: Scale and Competition about?
New trade theories are based on increasing returns to scale and imperfect competition, relaxing assumptions of traditional trade models. There are several sources of gains from trade when economies of scale are present, including: 1) Pro-competitive gains from a larger market supporting more firms and competition. 2) Specialization and trade allowing countries to consume above their production possibilities. 3) Monopoly profits from firms producing at a larger scale for international markets.
- Author
- mani12_mit163
- Language
- EN