This paper examines the effect of trade with developing countries on European labor markets. First, it is important to note that the evolution of developing countries over the last ten years has been dramatic. One can imagine the impact on the world economy of China and India should they become as productive as Hong Kong and Singapore. Add to that the potential impact of the former centrally planned countries, which lie very close to Western Europe and are another potential source of inexpensively produced goods. One can well understand the perceived fear of workers and politicians alike of job displacement and reduced incomes—concerns that have led us to produce this paper.