The emergence of new international trade theory and its hypothetical premise.

Traditional trade theory is the product of classical economics, which is based on some rigorous theoretical assumptions, mainly including: perfect market competition, constant or decreasing returns to scale, similar and unchanged demand preferences of countries, model analysis of two countries, two commodities and two elements, namely 2×2×2 model. According to the new trade theory, it is these premises that do not conform to today's social and economic life, which makes the traditional trade theory unable to explain the reality. We should relax and establish a more realistic premise:

1. With the introduction of industrial organization theory, the assumption of market structure is transformed into more realistic incomplete competition.

2. The scale reward is no longer constant, but increasing.

3. The traditional 2×2×2 trade model is too simplistic, and the new trade theory is changed to J×N×M model.

4. Abandon the assumption that trading countries have the same possibility of acquiring production technology, and study the impact of the possibility of acquiring technology in different countries on international trade.

After establishing a more realistic premise hypothesis and breaking the two key assumptions of "perfect competition" and "constant return on scale" in traditional trade theory, it has opened up a new source for explaining trade motivation and trade foundation, and the new trade theory has been developed and expanded.