In this paper, we develop techniques for measuring the trade policy
equivalent of domestic distortions, using a distance function approach.
Our measure, the Trade Restrictiveness Index, is shown to equal the
uniform tariff which is welfare equivalent to a given pattern of
domestic taxes and subsidies. We extend the index to incorporate taxes
in markets for nontraded goods and factors of production and illustrate
its operationality with an application to liberalisation in Mexican
agriculture. We conclude that our index has considerable potential in
empirical work and as an aid to trade negotiators.