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This paper describes an experiment and simulation with features of a spatially explicit trading environment. Decision makers repeatedly make decisions about firm headquarters, input demands, and export patterns. A goal of this research is to determine if subjects� management decisions reflect profit maximization, learning, or heuristic decision making. It also considers what impact decision makers� bounded rationality has on the aggregate pattern of trade. Results indicate that bounded rationality in the form of learning and heuristic decision making are ubiquitous features of subjects� decisions. This manifests as under-reaction to trade-driver stimuli and produces Trefler's missing trade, suggesting a behavioral basis for this anomaly.
