This article examines U.S.-European relations in matters of trade and finance. It finds substantial accomplishments in the postwar record, but warns that structural changes and policy errors are impairing the competitiveness of the advanced economies of the West and therewith threatening a new protectionism. The same forces are also eroding the effectiveness and are serving to complicate the coordination of macroeconomic stabilization policies.
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References
1.
For issues relating to the North-South debate, see J. N. Bhagwati, ed., The New International Economic Order (Cambridge: MIT Press, 1977).
2.
2. For a collection of papers on this and other issues addressed here, see R. E. Baldwin and J. D. Richardson, eds., International Trade and Finance (Boston: Little, Brown, 1981).
3.
3. A useful source covering many of the issues raised here is the series Essays in International Finance (Princeton: Princeton University Press).
4.
4. On the choice of exchange-rate regime, see E. Tower and T. D. Willett, “The Theory of Optimum Currency Areas and Exchange Rate Flexibility,”Special Papers in International Finance (Princeton: Princeton University, 1976).
