International Trade in Conditions of Monopolistic Competition

Abstract

In the global economy, international trade plays a pivotal role in shaping the dynamics of competition among firms in different countries. Firms engaging in international trade often operate in markets characterized by monopolistic competition, where each firm has some degree of market power due to product differentiation. This unique market structure gives rise to complexities that are distinct from perfect competition or monopoly. Understanding the implications of international trade in the context of monopolistic competition is essential for policymakers, businesses, and consumers alike. By exploring how firms compete for market share, how trade barriers impact competition, and how firms innovate to differentiate their products, we can gain insights into the intricate relationship between international trade and market competition. This research aims to provide a comprehensive analysis of these interactions and their implications for the global economy.