When trade is increased, it may favor large exporting companies while harming their smaller competitors. This may decrease competition as a few huge firms dominate global markets.

Question

Answer

Pro: The firms most likely able to export a significant amount of goods are those that are already large enough to benefit from economies of scale.

Answer

Pro: As a firm grows globally, it will be able to access even greater economies of scale, further pushing down their prices and making competition difficult.

Answer

Con: Often, demand remains high for 'local' or 'authentic' products, meaning that consumers still have choice despite the international market power of these firms.

Is more trade always beneficial for countries?

When trade is increased, it may favor large exporting companies while harming their smaller competitors. This may decrease competition as a few huge firms dominate global markets.

Pros

Cons

The firms most likely able to export a significant amount of goods are those that are already large enough to benefit from economies of scale.

As a firm grows globally, it will be able to access even greater economies of scale, further pushing down their prices and making competition difficult.

Often, demand remains high for 'local' or 'authentic' products, meaning that consumers still have choice despite the international market power of these firms.

Selected claim, opposing its parent

When trade is increased, it may favor large exporting companies while harming their smaller competitors. This may decrease competition as a few huge firms dominate global markets.

Pro claim 1, children below

The firms most likely able to export a significant amount of goods are those that are already large enough to benefit from economies of scale.

Pro claim 2

As a firm grows globally, it will be able to access even greater economies of scale, further pushing down their prices and making competition difficult.

Con claim 1

Often, demand remains high for 'local' or 'authentic' products, meaning that consumers still have choice despite the international market power of these firms.