tradepolicy

Trade policy refers to the set of government measures that influence international trade. It encompasses rules, regulations, and actions that affect the import and export of goods and services. The objectives typically include improving economic efficiency, raising government revenue, protecting domestic industries, and responding to social, environmental, or security concerns. Trade policy also shapes how resources are allocated and how supply chains respond to external shocks.

Instruments include tariffs, quotas, licensing requirements, and other non-tariff barriers such as technical standards or sanitary measures. It also covers export controls, subsidies to domestic producers, and anti-dumping or countervailing duties. Governments negotiate or join regional and multilateral agreements to reduce barriers and create predictable rules for trade.

Trade policy can be liberalizing, aiming to open markets and increase competition, or protectionist, seeking to shield specific sectors. Policies may be applied unilaterally or through bilateral, regional, or multilateral arrangements. The net effects depend on the policy mix, the structure of the economy, and the reactions of trading partners, influencing prices, production, employment, and consumer welfare.

Key institutions include the World Trade Organization, regional trade agreements, and national ministries of trade or commerce. Evaluation relies on economic analysis of costs and benefits, distributional impacts, and considerations of development and governance. Debates often focus on balancing efficiency with equity, the legitimacy and transparency of policy choices, and the best means to address strategic industries and global public goods.