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Much of the literature on strategic trade policy deals with industries and sectors characterized by international rivalry for market shares, and the struggle to capture “rents” over and above normal factor rewards. The present paper explores the validity and implications of strategic trade policy for small “states” and small firms that are not major players in international markets. The smallness of the firms may, in fact, be an advantage rather than a hindrance. The implications of smallness for strategic behavior are examined in the framework of a simple game-theoretic framework. These insights become sharper when extended to intra-industry trade in differentiated products. The desirable policy interventions for small countries and firms are quite different from those for large firms.

When designing a joint system for a complex, dynamic, open environment, where the consequences of poor performance by the joint system are potentially grave, the need to shape the machine agents into team players is critical. Traditionally, the assumption has been that if a joint system fails to perform adequately, the cause can be traced to so-called “human error.” However, if one digs a little deeper, they find that the only reason many of these joint systems perform adequately at all is because of the resourcefulness and adaptability that the human agents display in the face of uncommunicative and uncooperative machine agents. The ability of a joint system to perform effectively in the face of difficult problems depends intimately on the ability of the human and machine agents to coordinate and capitalize upon the unique abilities and information to which each agent has access.For automated agents to become team players, there are two fundamental characteristics which need to be designed in from the beginning: observability and directability. In other words, users need to be able to see what the automated agents are doing and what they will do next relative to the state of the process, and users need to be able to re-direct machine activities fluently in instances where they recognize a need to intervene. These two basic capabilities are the keys to fostering a cooperative relationship between the human and machine agents in any joint system.