The Theoretical Rationale for a Common European Currency Revisited

At the outset of a discussion of monetary integration, the characteristics that are essential for a monetary union as well as those necessary for the continued and successful existence of the monetary union must be considered. These three requirements—effectively a single currency, a single union monetary policy, union control of international reserves and the external exchange rate—are regarded here as essential for an arrangement to qualify as a monetary union. It is necessary to realize from the beginning that the political commitment to achieve the goals of a European monetary system must be present. In other words, the national sovereignty member nations turn over to union authority and the extent national policies and performance are brought into greater harmony will determine whether a monetary union stands or falls

Common Market Competition Policy as a Strategic Planning Issue for Transnational Firms

Managers in charge of international business decisions must recognize competitive conditions to make production, distribution, and marketing decisions. They must be cognizant of competitors\u27 strategies as well as institutional arrangements which affect competition. As the international business environment has expanded, government regulations designed to control unfair or restrictive business practices have proliferated. Today, nearly all major developed countries with market economies prohibit the abuses of monopoly power and proscribe certain enterprise activities which restrain competition. Furthermore, governments have become less reluctant to apply their antitrust law extraterritorially. The ability of multinational firms to compete in international markets will increasingly depend upon their recognition and adherence to statutes which regulate business operations. This paper discusses the historical development of European Economic Community (EEC) competition policy with regard to U.S. firms competing in the Common Market. The study points out the business practices of American multinationals that have been determined to be incompatible with the EEC treaty. Further, the Community\u27s settlement of its antitrust case with IBM, and the effects of the agreement are analyzed. This paper discusses the historical development of European Economic Community (EEC) competition policy with regard to U.S. firms competing in the Common Market. The study points out the business practices of American multinationals that have been determined to be incompatible with the EEC treaty. Further, the Community\u27s settlement of its antitrust case with IBM, and the effects of the agreement are analyzed

Common Market Competition Policy as a Strategic Planning Issue for Transnational Firms

Managers in charge of international business decisions must recognize competitive conditions to make production, distribution, and marketing decisions. They must be cognizant of competitors\u27 strategies as well as institutional arrangements which affect competition. As the international business environment has expanded, government regulations designed to control unfair or restrictive business practices have proliferated. Today, nearly all major developed countries with market economies prohibit the abuses of monopoly power and proscribe certain enterprise activities which restrain competition. Furthermore, governments have become less reluctant to apply their antitrust law extraterritorially. The ability of multinational firms to compete in international markets will increasingly depend upon their recognition and adherence to statutes which regulate business operations

The Theoretical Rationale for a Common European Currency Revisted

At the outset of a discussion of monetary integration, the characteristics that are essential for a monetary union as well as those necessary for the continued and successful existence of the monetary union must be considered. First, in any monetary union, either there must be a single currency, or if there are several currencies, these currencies must be fully convertible, in one another, at immutably fixed exchange rates thus effectively creating a single currency. Second, the immutability of fixed exchange rates depends upon mutually consistent monetary policies within the union. Thus, there must be an arrangement whereby monetary policy for the union, especially regulations affecting the commercial banks\u27 ability to create money, is determined at the union level. Finally, there must be a single external exchange rate policy, because there can be only one rate of exchange between an external currency and union currency. To achieve such an end, the national authorities must relinquish individual control over their international reserves and invest control in a union authority

The Social Economics of Frank H. Knight

Frank Hyneman Knight is well known for rehabilitating neoclassical economics with his 1924 critique of Pigouvian welfare economics. In Knight\u27s thirty years at the University of Chicago, he thoroughly developed the notion that economic freedom and market competition are essential to maximize society\u27s welfare. However, Knight\u27s belief in the superiority of the market mechanism does not preclude serious concern about issues of social justice and reform. This study seeks to establish Frank H. Knight\u27s contributions to social economics. Elements of Knight\u27s work will be compared to commonly recognized characteristics of a social economist. Knight\u27s prominence in the discipline of economics warrants an investigation of his contribution to the intellectual history of social economics. The following section outlines a framework for isolating contributions to the field of social economics. Then, the specific elements of Knight\u27s social economics will be considered

Economic Foundations for the Competition Policy Implemented by the EEC

The purpose of this study is to provide a theoretical economic framework for the analysis of the competition policy implemented by the European Economic Community (EEC). The fundamental objective is to demonstrate that the EEC\u27s actual approach to regulating restrictive business practices can be related to a concept of competition that is relevant and adequate for the analysis and explanation of competition policy in the EEC. The thesis is that a strong theoretical relationship can be shown to exist between EEC business regulation and the conceptual parallels in the theories on competition of J.A. Schumpeter and J.M. Clark

Adam Smith on Competitive Religious Markets: Preaching about Preachers?

Anderson (1988) and Rosenberg (1960) have provided substantial insights into Adam Smith\u27s economic analysis of religious behavior. In particular, both emphasized Smith\u27s optimistic view of competitive religious markets. As an addendum, this paper investigates more closely the theoretical basis for Smith\u27s prediction that optimal religious doctrine and institutions would spontaneously evolve in free markets for preachers

Issues and Implications of Implementing Surcharges to Improve the U.S. Balance of Trade

Throughout the 1970s and early 1980s, increasing positive balances on the services account provided a substantial offset to negative balances in merchandise trade, and, consequently, the cumulative current balance was a positive $3.8 billion for the period 1970-80. Since 1981, the progressively smaller balances in services have been insufficient to offset the increasingly negative merchandise trade balances. Table 1-1 shows the deterioration in U.S. international accounts during this period

An Assessment of the Impact of Thrifts on Commercial Bank Competition in the Richmond, Virginia, R.M.A.

“Yes Virginia, there is trouble in the Savings and Loan Industry.” Depending upon who one believes, the cost of restructuring and creating a vital thrift industry will be between $50 billion and$100 billion. Nevertheless, political concerns virtually guarantee that the industry which has helped make the American dream a reality will be nurtured (force fed if necessary) back to good health. As the savings and loan industry is rehabilitated, bankers can be expected to increasingly assert that thrift institutions represent a major factor in their markets. Both Federal and State bank regulators will be called upon to place more weight on the presence of thrift deposits in their markets when analyzing the effect on competition from a proposed merger. Further, the inevitable “shake-out” in the thrift industry will increase concentration in some financial markets and necessitate careful consideration in competition analysis by bank regulators

Benefits and Costs of a Variable Oil Import Fee

The sharp decline in real world oil prices since 1986 has had a significant impact on the U.S. economy, moderating the rate of inflation and reducing energy costs of consumers and businesses while creating widespread unemployment, bankruptcies and bank failures across the oil-producing states of the Southwest. Combined with record federal budget and trade deficits, these severe regional dislocations have rekindled the debate over an increase in the (currently very small) U.S. oil import tariff. The most frequently suggested forms such an increase would take is either that of a fixed fee of $5 or$10 per barrel (such as Representative Gephardt\u27s proposal) or a variable fee set equal to the difference between the world oil price and a guaranteed minimum domestic price of $22-$24 per barrel (as recently suggested by Governor Clements of Texas)