This paper presents substantial new evidence on the competitive process that links together industrial economics and international economics. Our time-series data base concerns manufactured product prices and their domestic and international determinants. We identify cointegrating relationships, using single equation and multivariate methods. We find that both market imperfections, largely ignored in international economics, and international factors, mostly neglected in industrial economics, should be jointly incorporated into pricing analysis. The significance of global factors varies markedly: differentiated-product sectors respond little to foreign price signals. Our findings are relevant to many fields within economics, including the transmission of inflation.