• MNEs strive to take advantage of imperfections in national markets for products, factors of production, and financial assets.
• Imperfections in the market for products translate into market opportunities for MNEs. Large international firms are better able to exploit such competitive factors as economies of scale, managerial and technological expertise, product differentiation, and financial strength than their local competitors are.
• MNEs thrive best in markets characterized by international oligopolistic competition, where these factors are particularly critical.
• Once MNEs have established a physical presence abroad, they are in a better position than purely domestic firms are to identify and implement market opportunities through their own internal information network.

The theory of market defects is a trade theory that develops from global markets where perfect competition is absent. In other words, at least one of the presumptions for perfect competition is broken, and as a result, what we refer to as an imperfect market results. Imperfect markets are those in which there is fierce competition for market share, significant entrance and exit restrictions, a wide variety of goods and services, and few buyers and suppliers. All real-world markets are imperfect; ideal markets do not exist in theory and cannot exist in practice. Monopolies, oligopolies, big trading partners, externalities, the provision of public goods, non-clearing markets, incomplete information, and government tax and subsidy programs are a few of the most prevalent market defects.

To learn more about Imperfect markets click here

brainly.com/question/28508268

#SPJ4