The theory of competitive advantage is one of the most widely accepted principles of economic economists. Theory, as well as significant historical evidence suggests that free trade increases national income, while government intervention in trade relations in general reduces the wealth of the nation. In the last few years, however, new theories have led some commentators to question this conclusion. Based on studies in imperfectly competitive industry, some new theoretical studies show that it is possible to increase the national wealth with certain types of government intervention in trade. Study called the new international economic or strategic trade theory. Though interesting, these trade theories are often misunderstood and misused. This note presents four strategic trade theory. Also discusses several criticisms of these theories. Rewritten version of the earlier notes. "Hide
on Robert Kennedy 6 pages. Publication Date: June 14, 1996. Prod. #: 796184-PDF-ENG
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