Barriers are imposed against imports and foreign businesses to encourage development of domestic industry and protect existing industry. Most countries use combinations of tariffs and quotas with other trade barriers to protect domestic companies.

A tariff is a tax imposed by a government on goods entering at its borders. They may be used as a revenue-generating tax or to discourage the importation of goods. They are arbitrary, discriminatory, require constant administration and supervision, and are often used as retaliation against protectionist moves of trading partners. Tariffs increase governmental control and interject politics into economics which generally leads to an increase in the number of tariffs imposed. Tariffs also limit manufacturers' supplies, consumer choices, and competition.

In a dispute with the European Community over pasta export subsidies, the United States ordered a 40 percent increase in tariffs on European spaghetti and fancy pasta. The EC retaliated with tariffs on U.S. walnuts and lemons. The EC also increased tariffs on U.S. fertilizer, paper products, and beef tallow. The U.S. responded similarly. This war continued until the Europeans dropped previous export subsidies.

A quota is a specific unit or dollar limit applied to a particular type of good. Like tariffs, quotas tend to increase prices. U.S. quotas on textiles are estimated to increase the wholesale price of clothing by 50 percent. Great Britain restricts the number of imported television sets, Germany restricts Japanese ball bearings, Italy restricts Japanese motorcycles, and the U.S. has quotas on sugar, textiles, and peanuts.

The VER is an agreement between the importing and exporting countries for a restriction on the volume of imports. Japan has a VER on automobiles to the United States; it has agreed to export a set number of automobiles to the U.S. annually. A VER is voluntary, but it is usually imposed under threat of strict quotas and high tariffs.

A boycott is an absolute restriction against the purchase and importation of certain goods from other countries. A boycott may be formal or informal and may be government sponsored or industry sponsored.

A government may regulate international trade with various forms of exchange-control restrictions to preserve its balance-of-payments position or to help or encourage specific industries.

Governments use standards as nontariff barriers to protect health, safety, and quality. Many standards are extremely stringent or discriminatory, and the sheer volume of regulations is one of the major problems. Differing standards can cause major disagreements between countries, particularly the United States and Japan. Many countries require some products to contain a percentage of "local content" to be admitted into their markets. The North American Free Trade Agreement (NAFTA) requires all automobiles coming from member countries (United States, Canada, and Mexico) to contain 62.5 percent North American content to deter foreign car makers from using one member nation as a back door to another.