The product life cycle theory is better at explaining trade patterns ex-post rather than ex-ante.

Question

Quizplus · Accepted Answer

The product life cycle theory, which suggests that products go through stages of introduction, growth, maturity, and decline, is more effective at explaining trade patterns after they have occurred (ex-post) rather than predicting future trade patterns (ex-ante), because it relies on observing the actual progression and distribution of products over time.

The Product Life Cycle Theory Is Better at Explaining Trade