Which theory stresses that in some cases countries specialize in the production and export of particular products not because of underlying differences in factor endowments, but because in certain industries the world market can support only a limited number of firms?
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This is about the international Trade theory.
It was proposed in 1776 and it explained how in case of many developing countries, the production of various products and free trade activities underlies the different parts of endowments, and in certain industries the world market could also support only a small and restricted number of firms to carry out trade activities.
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