Recent advances in trade theory have stressed the connections between the external and internal dimensions of competitiveness, which have become increasingly relevant in a globalising economy.
Some of the latest economic models of trade1 see global competition as a selection mechanism, in which only the most productive firms do business outside their national borders.2 Less productive firms, by contrast, which are unable to bear the transport and other costs related to foreign trade, are either forced out of business or remain confined to their domestic market.