From Trade Between Countries to Trade Between Businesses
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Publication date: 2011-03-31
GNPJE 2011;246(3):47-65
The article focuses on the latest trends in the theory of international trade, which, according to the author, are relatively little known in Poland. Serwach sets out to show that the theoretical analysis of trade has evolved over the years toward purely microeconomic considerations. Referring to specific research reports, the paper describes the main directions of theoretical research today: a new theory of trade that takes into account the diversification of companies, a theory of trade conducted by multiproduct companies, and the so-called incomplete contract theory. Serwach shows that these new trends overlap and complement previously existing theories. The overview of the latest theories of international trade presented in the article prompts several conclusions. One of these is that many theoreticians focus on the relationship between a company’s productivity and its decision to go international with its business. The trends discussed in the article involve the problem of the significant role of fixed costs in shaping trade flows, the author says. Although the latest ideas make it possible to offer a theoretical explanation of many empirical phenomena in the trade of goods, Serwach says, these concepts have some limitations. These include the lack of in-depth modeling of demand and a tendency to ignore strategic interactions between firms.
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