The system of rules and agreements that currently governs international trade is based on the view that expanding global trade is beneficial to all countries and their citizens. Trade liberalization, as part of a larger set of liberalization policies that increase the role of markets and reduce the role of states, is regarded as the key to such an expansion. These views derive from mainstream trade theory, which holds that specialization in production according to each nation’s comparative advantage typically leads to a more efficient allocation of resources in the world economy, and consequently to higher levels of output and economic growth in all countries. It is recognized that trade liberalization creates both winners and losers within each country, but net gains are assumed overall, allowing losers to be compensated by government polices such as trade adjustment assistance.