Which theory stresses that in some cases countries specialize in the production and export of particular products not because of underlying differences in factor endowments but because in certain industries the world market can support only a limited number of firms?

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The theory of new trade stresses that in some cases countries specialize in the production and export of particular products not because of underlying differences in factor endowments but because in certain industries the world market can support only a limited number of firms. This leads to economies of scale and a concentration of production in a few countries, resulting in trade patterns that would not be predicted by traditional theories such as the Heckscher-Olin model.

Which Theory Stresses That in Some Cases Countries Specialize in the Production