ABSTRACT
The role of an interventionist approach to trade and antitrust could be admitted, including the selective targeting of 'strategic industries'. B. Hoekman and P. Mavroidis have claimed that the best antitrust policy for nations to pursue is a free trade policy because of its pro-competitive impact. Helen Milner argues that increasing economic interdependence has altered the way in which international economic exchange occurs. This chapter explores the implications of economic interdependence and imperfect competition for trade. With the increasing influence of economic theories embodying the notion of imperfect competition and strategic interdependence of firms in international as well as domestic markets, theorists have recognized that there are situations in which competition can have a detrimental impact on social welfare. A consequence of the re-conceptualization of the causes of international trade and investment has been the realization that multinational enterprises are increasingly important in determining international trade. Finally, the chapter also presents overview of the key concepts discussed in this book.
