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Why Can't the Models Developed in Previous Chapters (Ricardian, Specific

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Why can't the models developed in previous chapters (Ricardian, specific factors, and Heckscher-Ohlin) be used to explain trade in intra-industry products?


Definitions:

Competing Producers

Entities or companies that are in the same market striving to gain market share by offering better products, price, or services.

Perfect Competition

A market structure characterized by a large number of small firms, identical products, and freedom of entry and exit, leading to price takers.

Barriers To Entry

Economic, procedural, or regulatory obstacles that prevent or deter new competitors from easily entering an industry or area of business.

Absolute Market Power

The ability of a single economic actor, or a group of actors, to control market prices, output, and/or the market entry of new competitors without external interference.

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