The concept of "trade creation" refers to

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Trade creation refers to the creation of new trade patterns, resulting from the reduction or elimination of trade barriers, by diverting trade from high-cost producers to low-cost producers. This leads to an increase in trade between the countries, leading to increased efficiency, specialization, and higher living standards. The concept is based on the theory of comparative advantage, according to which countries specialize in producing goods and services where they have a cost advantage, and then trade with each other based on those strengths.

The Concept of "Trade Creation" Refers to