Chapter 12 Trade policies in developed countries Modern policy oriented analysis of trade issues in developed countries focuses mainly on five sets of questions. This chapter discusses the differences in the levels of protection among industries. The industry and economy wide effects of trade liberalization on economic welfare trade output employment and the distribution of income are discussed and the effectiveness of the government policies are introduced for the purpose of assisting the economic adjustment to increased import. The chapter also discusses the economic effects of discriminatory tariff arrangements such as customs unions and the generalized system of preferences. The economic impact of specific nontariff measures such as quantitative restrictions preferential government purchasing policies export domestic subsidies countervailing duties dumping and antidumping duties and domestic content requirements are reviewed. The chapter further discusses institutional arrangements and policies that maintain order in the international trading system and in the management of trade policy conflict. Representative studies are cited with a view to establishing the main research results and suggesting issues on which further research is needed.