ABSTRACT
Very little is known about the gains from trade under conditions of imperfect competition. The little that is known is unsatisfactory as a guide to the formation of policy. For a typical proposition relates trade gains to trade-induced changes in commodity outputs, which can be known only after a possibly costly social experiment; see, for example, Kemp and Negishi (1970, 1971) and Helpman and Krugman (1985: 96-100). What we need are propositions which relate trade gains to the underlying characteristics of the world economy (national endowments, preferences, technologies and market structures).
