Abstract
Since the inception of the study of international trade, the most common modeling framework has been that of perfect competition and of general equilibrium. While the recent development of what has been called the ‘new trade theory’ has led to the analysis of trade issues in models involving imperfect competition, including monopolistic competition and oligopolistic competition, the perfectly competitive equilibrium framework continues to be a dominant force in international trade theory.
This chapter has benefited considerably from comments on earlier drafts by Daniel Bernhofen, Mauro Caselli, Xiao Chen, Christos Kotsogiannis and Mark Melatos. The research was financially supported by the Australian Research Council.
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© 2013 Alan Woodland
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Woodland, A. (2013). General Equilibrium Trade Theory. In: Bernhofen, D., Falvey, R., Greenaway, D., Kreickemeier, U. (eds) Palgrave Handbook of International Trade. Palgrave Macmillan, London. https://doi.org/10.1007/978-0-230-30531-1_3
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DOI: https://doi.org/10.1007/978-0-230-30531-1_3
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