While intra-industry trade is “bilateral trade in similar goods” (Krugman et al., 2015). Therefore, intra-sector trade is “not based on comparative advantage” (Krugman et al., 2015). The main difference between inter-industry and intra-industry trade is that inter-industry trade occurs due to comparative advantage whereas intra-industry trade occurs due to lower costs through economies of scale and the largest variety of products for consumers. For example, there is intra-industry trade in the US automobile industry (Turkcan and Ates, 2010). Turkcan and Ates (2010) point out that increased outsourcing in the automobile industry has increased intra-industry trade; Outsourcing has allowed manufacturers to obtain parts from “best suppliers,” resulting in “lower unit costs.” They also indicate that companies “benefit from economies of scale” when outsourcing (Turkcan and Ates, 2010). Another difference is that since monopolistic competition cannot predict which country will import and export under intra-industry competition, product differentiation can create a comparative advantage that can determine which country will import and export a certain variety of a product. For example, Japan mainly makes family cars, like Toyota, while Germany mainly makes sports cars, like Audi; therefore, Germany will have a lower unit cost for sports cars and Japan will have a lower unit cost for family cars (Dudovskiy, 2012). In