Internalization can help reduce opportunistic behavior in international trade.

Question

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Internalization refers to the process of bringing an activity that was previously outsourced or conducted by another party in-house. By internalizing international trade activities, firms can better monitor and control the behavior of their employees, reducing the likelihood of opportunistic behavior such as bribery, kickbacks, or fraud. Therefore, internalization can help reduce the risk of opportunistic behavior in international trade.

Internalization Can Help Reduce Opportunistic Behavior in International Trade