Trade is a well-established driver of growth and poverty reduction. Also changes in trade policy have distributional
impacts that create winners and losers. It is vital to understand and clearly communicate how trade affects
economic well-being across all segments of the population, and how policies can effectively ensure that the gains are
distributed more widely. This study provides a deep understanding of the distributional effects of trade across regions, industries, and demographic groups within countries. It includes an overview; a review of innovations in empirical and theoretical work covering the impacts of trade at the subnational level; highlights from empirical case studies on Bangladesh, Brazil, Mexico, South Africa, and Sri Lanka; and a policy agenda to improve distributional outcomes. A better understanding of how trade affects distributional outcomes can lead to more inclusive policies and support the ability of countries to maximize broad-based benefits.